Yorkshire retailer makes a swoop for funkypigeon.com
Wakefield-based Card Factory has bought funkypigeon.com to boost its digital strategy and market share of the burgeoning online greeting cards and gifts market.
Card Factory has acquired the business from WH Smith in a £24m deal.
Bristol-based Funky Pigeon has achieved average revenues over the last two years of £32m and EBITDA of £5m. The acquisition is subject to regulatory approval.
Card Factory said the acquisition will accelerates its existing digital strategy, providing a platform for online growth, particularly in the direct-to-recipient card and attached gifting market.
By combining Funky Pigeon’s digital platform with its existing omnichannel offer, Card Factory intends to leverage its 24 million unique store customers to develop a highly competitive online presence in the celebration occasions market.
Upon completion, Card Factory will be the UK’s second largest online card and attached gift retailer.
In a trading update, Card Factory said the board’s expectations of mid-to-high single-digit percentage growth in both sales and adjusted PBT for FY26 remain unchanged.
With the strong H2 trading calendar ahead including back to school, Halloween and the Christmas season, it remain confident in its ability to deliver on full year expectations.
Darcy Willson-Rymer, Card Factory chief executive officer, said: “This acquisition marks a significant step forward in Card Factory strategy to build a scaled, competitive digital presence in the celebration occasions market. It brings a high-quality platform and proven technology, accelerating our ability to compete in the direct-to-recipient card and gifting segment, so supporting our ambition to become the leading omnichannel retailer in our sector.
“Together, the enlarged customer base will benefit from a richer, more convenient customer proposition, combining the strength of our nationwide store estate and wider celebrations offer with Funky Pigeon’s exceptional digital experience. Operational efficiencies, fulfilment synergies, and a unified technology platform will provide the data needed to develop deeper insights into the customer journey, enabling us to build a stronger, more integrated omnichannel business.”
The consideration of £24m is based on an enterprise value of £26m and is subject to closing adjustments, implying an EV/EBITDA multiple of 5x.
The group expects the acquisition to be earnings enhancing in the financial year ended 31 January 2027, with annual synergy benefits of more than £5m are expected from optimising manufacturing and fulfilment, technology platforms and product ranging.
The acquisition will be funded from draw down of up to £35m provided by Card Factory’s banking syndicate.
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