Buy4Now purchased for €10 million

Sunday Business Post - Done Deal Page - Sep 21 2008
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US retailer group MyWebGrocer has acquired the US business of Irish company Buy4Now in a deal valued at $15 million (€10 million).

Under the terms of the agreement, Buy4Now founder Ali Murdoch will head up the new operation, Buy4Now USA, under MyWebGrocer ownership.

Murdoch will retain his existing 10 per cent shareholding in the Irish company, with sales director and co-founder Michael Veale succeeding him as chief executive.

The €10 million acquisition figure includes an estimated €6.5 million outlay by MyWebGrocer and approximately €3.5 million in restructuring costs.

Veale, along with fellow directors Kevin Murphy, Dan Murphy and Allen Corcoran, hold a 53 per cent shareholding in the Irish company. Veale said the deal would benefit all concerned.

‘‘Ali Murdoch has been living and working in the US for some years and it is very exciting for the new management team here,’’ Veale said.

‘‘While we owned a small percentage of something that was bigger, we now have a larger percentage of a pretty valuable company going forward. The original investors - Superquinn, Grafton and Eircom - have also retained an interest.”


Veale said MyWebGrocer had instigated the deal, approaching Buy4Now late last year. ‘‘We were a major competitor of theirs in the US, and we were winning a lot of the large accounts, so they approached us to see if we were willing to sell the US business,” he said.

Buy4Now entered the US market in 2004, securing e-grocery agreements with retailers including A&P Group, Roche Brothers, New Seasons Market and Lunds & Byerlys. Established in 2000, the company has 80 staff and an annual turnover of €8 million.

An online portal for retail brands, it features more than 20 Irish retailers, including Superquinn, Atlantic Homecare and Arnotts, and 2.5 million products on its website.

Veale said the company’s original e-retail model had evolved over the years to include software development.

‘‘We now see ourselves primarily as a software and services company for retailers,” he said. ‘‘We can design and develop a website, host it and maintain it for you, and also provide call centre support facilities.

‘‘If you buy any phone from our biggest client - 3 mobile - whether through a partner store, their own store, online, or telesales, at some stage you are using Buy4now software.”

Veale said the company planned to focus its future expansion efforts on overseas markets closer to home, including Britain and other European countries.

‘‘While we have been very successful in the US, we have been looking at lesser-developed e-grocery markets in Europe,” he said. ‘‘We see opportunities there for driving the company forward. Europe and Britain are pretty untapped markets for us.”