eStore acquired for up to $1.8 million

Online technology retailer eStore.com.au has been acquired by publicly listed Shoply for up to $1.8 million.

The eStore business would bring $7 million of annualised revenue and would take Shoply's 2016 forecast revenue up to $25 million, according to an ASX announcement. eStore will also add 64,000 customers to Shoply's customer database.

The transaction includes $500,000 cash, $250,000 of shares, plus $1.05 million in incentive payments over the next 24 months.

Shoply claimed that eStore is "the number 1 online reseller" of Microsoft digital download products by volume. CRN has sighted an email from Microsoft verifying this claim.

eStore chief executive Lorenzo Coppa will join the board of Shoply as part of the deal. Coppa confirmed to CRN that he will contnue working in both roles.

"eStore is a fantastic cash producing business. We carry very little inventory... The growth is all dependent on marketing and vendor relationships," he said.

Shoply – a parent company for several online brands such as Your Home Depot, Warcom, Ezy Direct, Eljo, Ohki, Wow Baby and Toy Store – announced that eStore would bring it "increased depth in the office technology market".

Shoply chief executive Simon Crean said that the office technology market "presents an exciting growth opportunity, with a growing demand for technology upgrades required by the ever-increasing technology requirements of organisations, as well as the reinvestment driven by the roll out of the National Broadband Network".

eStore was first established in 1991, with Coppa's City Software rescuing it from administration in 2000. By 2013, the eStore business was rejuvenated to a point that Coppa sold his share of ERP-focused CitySoft to concentrate solely on the online retailer.

On the way, City Software scored a place on the 2010 CRN Fast50.

Coppa said in a statement that "eStore has built deep and broad supply relationships from which Shoply expects to benefit" and that he is "very excited by the opportunities that will arise through the combined group".