Feeds

Barclaycard swoops on ShopSmart.com

Mood Indigo

  • alert
  • submit to reddit

The essential guide to IT transformation

ShopSmart.com, the UK shopping comparison service, has been sold to Barclaycard for the knockdown price of £2million-ish, in cash and shares.

Barclaycard is to integrate the service into Indigo Square, Barclaycard's online shopping mall (yes shopping malls still exist). ShopSmart shareholders will hold 10 per cent of Indigo Square following the deal.

But however you dress it sale price represents a massive loss for shareholders, including Durlacher (the investment bank with the Reverse Midas Touch), which are said by the FT to have pumped in £19m into the company.

What a fall from the heady days of last year. Last August, five months after dotcom share prices hit their peak, the company's valuation was estimated at between £200m- and £300m, according to analysts canvassed at the time by FT. What are these analysts doing now?

Such a valuation was never realistic for ShopSmart, considering it sold 22.5 per cent of its equity in August to AOL and Wal-Mart for - nothing! Companies do not give away £40-60 million of equity in return for a distribution deal or two, if they think the shares are really worth that much.

The high-point for shopping comparison engine valuations was $700m for My Simon, bought by CNET in 1999.

Shopping bots, such as ShopSmart, Dealtime and Kelkoo are supposed to be one of the big Internet category killers. Their popularity is in little doubt, but how long it will take to translate this into retail brand-killing, money print machines, is open to question. ®

Boost IT visibility and business value

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
Banking apps: Handy, can grab all your money... and RIDDLED with coding flaws
Yep, that one place you'd hoped you wouldn't find 'em
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Primetime precrime? Minority Report TV series 'being developed'
I have to know. I have to find out what happened to my life
Broadband slow and expensive? Blame Telstra says CloudFlare
Won't peer, will gouge for Internet transit
Netflix swallows yet another bitter pill, inks peering deal with TWC
Net neutrality crusader once again pays up for priority access
prev story

Whitepapers

Best practices for enterprise data
Discussing how technology providers have innovated in order to solve new challenges, creating a new framework for enterprise data.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Advanced data protection for your virtualized environments
Find a natural fit for optimizing protection for the often resource-constrained data protection process found in virtual environments.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?