EMERGE Commerce Ltd., a diversified acquirer and operator of e-commerce brands, continues to grow its business with the latest acquisition being WholesalePet.com, a leading technology-enabled B2B e-commerce marketplace, connecting over 8,000 independent retail locations with over 400 independent pet vendors, offering over one million SKUs.
Ghassan Halazon, EMERGE Founder and CEO, said the landmark acquisition is a huge milestone as EMERGE now eclipses $100 million in gross merchandise sales on an annual basis.
The purchase price was US $25 million.
EMERGE went public in December 2020 and Halazon said the latest acquisition is its seventh (eighth brand) and largest one and the first B2B acquisition. It’s also the third acquisition (fourth brand) since going public.
He said the company’s main verticals are now Pets, Groceries/ Meat, Outdoor Gear, Golf, Experiences.
“It’s a big deal for us on a couple of fronts. First, it helps EMERGE eclipse the $100 million milestone in gross merchandise sales. We now comfortably process in excess of $100 million annually across our platform of e-commerce brands. That’s a nice symbolic number in the context of Canadian e-commerce,” said Halazon.
“The other aspect of this that’s interesting is that it’s our first foray into the fast growing $10 billion pet e-commerce market. That’s a super exciting space for us and it’s an anchor business for us in the broader world of pet e-commerce.
“It also happens to be the first time we’ve acquired a B2B platform. Traditionally EMERGE has been focused on direct to consumer brands. Wholesale Pet is actually a highly profitable B2B platform and it’s a marketplace that connects independent pet retailers – there’s about 8,000 independent pet retail stores that come onto the platform, that come onto the marketplace and there’s about a million SKUs available on the platform from about 400 vendors.”
Wholesale Pet generated gross merchandise sales of about US$40 million, revenue of US$3.7 million, and Adjusted EBITDA of US$2.8 million in the 12 months ended September 30, 2021.
“There’s a couple of things we really liked about this business. Number one, it has a 20-year track record of organic growth and profitability. This is a business that was founded in 2001 out of Virginia in the US,” said Halazon. “Along with the 20-year track record and organic growth and profitability one aspect that we really liked is how profitable this business really is. It has about 75 per cent EBITDA margins.”
“We are confident EMERGE is the best partner to help propel us to the next level in the dynamic $100B Pet Industry. Both teams are eager to accelerate current growth plans through EMERGE’s e-commerce expertise, data mining, sister-company synergies, and potential M&A opportunities. We also look forward to collaborating with EMERGE on new sources of value creation across our B2B marketplace, including launching new services and technologies,” said WholesalePet.com CEO Chris Avery.
EMERGE sold a record $2.7 million in gross merchandise sales during the 2021 Black Friday-Cyber Monday period, more than tripling GMS during the comparable 2020 period. A new single-day record for EMERGE was achieved on Cyber Monday, with GMS of approximately $1 million.
WholesalePet.com led the way with its largest total GMS during BFCM, with approximately $1.2 million GMS, or 44 per cent of total GMS, while JustGolfStuff achieved the highest growth rate for the period at over 100 per cent, year over year.