Loss-making Jungle.com, Britain's second largest online e-tailer, has been bought by Great Universal Stores for £37 million – substantially below initial valuations for the company which recently mulled a flotation with a highly imaginative £750m price tag.
Although one of the UK’s best-known online brands with over 300,000 registered users, Jungle plunged £11.4m into the red last year. The loss was exacerbated by a costly £5m marketing campaign and £2m in site development costs.
According to GUS chief executive John Peace, the deal will "establish GUS as a leading e-commerce retailer with annual sales of well over £50m". It adds Jungle’s range of computer and office products to GUS’s existing consumer products portfolio, selling via the group’s retail stores, catalogues and the internet.
Jungle founder and chief executive Steve Bennett has entered into a four year contract and will report to Terry Duddy, chief executive of GUS’s most buoyant wing, Argos Retail Group. Bennett described the GUS offer as “by far the best fit” of many received including, it is believed, bids from Kingfisher and Dixons Stores Group.
News source: BBC Online Business News (UK)