Card Factory (LSE:CARD) has completed the £24 million acquisition of funkypigeon.com Limited from WH Smith PLC (LSE:SMWH), a move the retailer says marks a “key milestone” in scaling its digital presence.
The deal strengthens cardfactory’s position in the direct-to-recipient card and gifting segment, combining Funky Pigeon’s established e-commerce platform and customer base with cardfactory’s store footprint and in-house manufacturing.
“The acquisition of Funky Pigeon accelerates our strategic ambition to build a scaled and competitive digital presence in the celebration occasions market,” said CEO Darcy Willson-Rymer. “We look forward to bringing together Funky Pigeon's high-quality technology platform and digital expertise with our broader celebrations offer.”
Funky Pigeon generated around £32 million in annual revenue and £5 million in EBITDA over the past two years. cardfactory expects to unlock over £5 million in annual synergies by FY27 through manufacturing and fulfilment efficiencies, platform integration, and product rationalisation.
The combined group now holds the number two spot in the UK’s online card and gift market.
The acquisition was funded via a £35 million accordion facility, with only a modest expected impact on leverage. The company said it remains committed to its capital allocation policy, including plans to pay down the additional debt over three years and maintain a progressive dividend.
cardfactory added that the Funky Pigeon platform will become the core digital platform for its UK and Ireland business, supporting both customer experience and future operational growth.