Posted: 6/7/2012
Fanatics, Inc., a leading online retailer of officially licensed sports merchandise, announced it has completed its previously announced acquisition of Dreams, Inc. In conjunction with the acquisition, Fanatics closed a $150 million equity investment led by Insight Venture Partners, with participation from Andreessen Horowitz, and a $75 million line of credit led by Bank of America. The funds will also be used to support future growth of the business.The Wall Street Journal reported the the investment amounted to a 10 percent stake in the company. Fanatics had previously said it would acquire Dreams for $183 million in cash and debt.
"The Internet allows for a significantly broader assortment of licensed sports merchandise to be sold to the consumer – especially to the displaced fan who is typically unable to purchase their favorite teams’ merchandise in local retail stores. As a result of this acquisition, Fanatics is even better positioned to deliver a superior customer experience for all sports fans," said Alan Trager, CEO of Fanatics. "In addition to providing greater product assortment, we are focused on expanding our distribution capabilities and opening regional fulfillment centers to deliver fans’ orders faster than before."
"We're excited about the opportunity to invest again in the Fanatics team," said Deven Parekh, Managing Director at Insight Venture Partners. "Our prior investment in Fanatics led to significant growth and success for the business, helping the Company achieve important milestones, including more than doubling its revenue. With the acquisition of Dreams, we believe Fanatics will continue its trajectory as the licensed sports merchandise business continues to thrive online."
In addition to its own Fanatics and FansEdge brands, the company operates licensed sports merchandise e-commerce sites for its partners, including major professional sports leagues, leading professional and collegiate teams, media sites and sports apparel manufacturers. Following the close of the Dreams acquisition, Fanatics headquarters will remain in Jacksonville, FL. The company will also operate offices in the suburbs of both Philadelphia and Chicago.
"Our goal is to build one of the world’s truly great e-commerce companies," said Michael G. Rubin, CEO and founder of Kynetic, who also serves as the Executive Chairman of Fanatics. "The combination of Fanatics and Dreams, the confidence in our business reflected in the investment from Insight and Andreessen Horowitz, and our expected revenue of $1 billion in 2013, all underscore our momentum toward achieving this goal."
In a separate statement, Dreams, Inc., the parent of FansEdge, said its shareholders have voted to approve its planned merger. Upon closing of the transaction, the company will become a wholly-owned subsidiary of Fanatics, the company’s common stock will no longer be listed on the NYSE Amex Equities Exchange and the company’s shareholders will be entitled to receive $3.45 in cash for each share of the company’s common stock.
Fanatics provides e-commerce, merchandising, marketing and fulfillment services for professional sports leagues and teams, collegiate athletic programs and conferences, and other major sports properties. Offering broad assortments online consisting of hundreds of thousands of officially licensed items, Fanatics leverages both its large network of partners and its own collection of proprietary brands, including Fanatics (www.fanatics.com) and FansEdge (www.fansedge.com), to distribute goods to consumers all over the world.
Kynetic is a private company focused on building consumer Internet businesses that capitalize on the digital transformation of commerce. Kynetic includes three brands at the forefront of innovation in the online commerce space: Fanatics, a leading online retailer of licensed sports merchandise, Rue La La, a leading online private sale destination in the U.S., and ShopRunner, an innovative members-only service which aggregates shopping benefits from top retailers and brands. Founded in 2011 by Internet entrepreneur Michael G. Rubin, Kynetic is based in the Greater Philadelphia area. EBay Ebay Inc spun off Fanatics last year, along with Rue La La and ShopRunner, in its acquisition of GSI Commerce.
Website : http://www.fanatics.com
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