PFSweb [NASDAQ: PFSW] to Divest LiveArea Business

PFSweb, Inc. [NASDAQ: PFSW] has disclosed Tuesday that it has decided to divest its global customer experience and commerce agency business unit, LiveArea to Merkle, Inc. With the sale of LiveArea underway, PFSweb has employed Raymond James to guide the discovery of a full range of strategic options for its remaining business segment, PFS, to boost shareholder value.

Through the first quarter of 2021, PFSweb’s strong performance has shown the advantages of its focus on enhancing resources and providing a dedicated, flexible partner for its clients. This divestiture clearly confirms its attempts to boost growth for each business unit and push value for its shareholders. The firm has vowed to continue to focus on boosting the growth of PFS while the firm will execute this strategic alternative process.

Share of PFSweb, Inc. [NASDAQ: PFSW] surged 39.37% as it has gained +2.98 at the time of writing on Tuesday. The firm has recorded a trading volume of 2.28 million as compared to the average volume of 127.71K. In the past 52-weeks of the trading session, the share of the firm has fluctuated between the 52-week low and high range of $5.26 and $9.89, respectively. PFSW has a total market capitalization of $159.27 million at the time of writing.

Financial Details

As per the divestiture agreement, Merkle will acquire LiveArea for a total payment of nearly $250 million. The firm is expecting a net profit in the range between $185 million to $200 million, after payment of predicted taxes and transaction-related expenses. After the execution of the deal, PFSweb anticipates making use of a portion of the net profit, along with current cash on hand, to pay down in full its senior financing facilities.

Additionally, for the trailing twelve months completed on March 31, 2021, LiveArea gathered nearly $85 million in revenue on a standalone basis. The deal is anticipated to execute in the third quarter of 2021, dependent on customary execution conditions.