Skip to main content

FTD buys Provide Commerce, creates $1 billion floral retailer


Downers Grove, Ill. -- FTD Companies Inc. will acquire the Provide Commerce floral and gifting business from Liberty Interactive Corp. for $430 million in cash and stock. Both companies have annual revenues of more than $600 million.

FTD will obtain Provide Commerce’s e-commerce brands, including ProFlowers, Shari's Berries and Personal Creations. FTD says the efficiencies and resources created by this acquisition will allow it to further invest in new products, services and technology. The combination is expected to generate more than $25 million in annual synergies within 36 months of closing, with a goal of creating incremental value for FTD stockholders over time.

"This transaction provides the opportunity to create significant value for our stockholders and offers immediate benefits for consumers and our premier network of member florists. The combination of these businesses will expand the breadth of our brands, provide opportunities to further diversify our revenue streams and open up additional avenues for growth and innovation," said Robert S. Apatoff, president and CEO of FTD. "We expect the combination with Provide Commerce's highly recognizable and successful portfolio of brands to enhance our already robust consumer product offerings. In addition, we expect the transaction will provide us with greater resources to further develop new product and service categories and broaden our consumer demographic through complementary customer bases."

Under the terms of the transaction agreement Provide Commerce will become a wholly-owned subsidiary of FTD. FTD and Liberty expect to complete the transaction by the end of 2014. Liberty will own about 35% of FTD after closing.

Upon closing of the transaction, FTD's management team will remain in place. FTD will expand its board of directors from seven to 11 directors with Liberty selecting four new directors for appointment to the board. While the transaction is being completed, FTD and Provide Commerce expect no change in their independent, existing operations, including customer service and product availability. There will be no immediate changes to the operations of Provide Commerce's e-commerce brands. Liberty will retain ownership of Provide’s Red Envelope e-commerce business.

FTD also released preliminary financial results for the second quarter of fiscal 2014. Net income for second quarter 2014 is expected to be in the range of $4.2 million to $4.7 million, compared to $5.5 million in the prior year period. Net income includes approximately $1 million net of tax ($1.7 million pre-tax) in transaction-related costs in connection with the planned acquisition of the Provide Commerce business. FTD also expects to report second quarter 2014 consolidated revenue of approximately $166 to $168 million, an increase of 1% to 2%, compared to $164.3 million in the same period of the prior year. Revenue in the second quarter was negatively impacted by lower consumer order volume in the U.S., offset by increases in consumer segment average order values, increased consumer order volume in the U.K. and favorable foreign currency exchange rates.

For the full year 2014, the company expects to report net income of $16.6 million to $20.6 million and consolidated revenues of $640 million to $650 million.

This ad will auto-close in 10 seconds