Amazon.com to acquire AbeBooks

Posted by Rob Lewis

Huge news from Vancouver Island – Victoria’s AbeBooks has been acquired by Amazon.com.

The transaction sees Seattle-based Amazon.com get the worldwide leading marketplace for used, rare and out-of-print books and access to an inventory of more than 110 million books. Makes sense considering Amazon.com’s trademarked “Earth’s Biggest Selection” claim. On the other side of the deal, AbeBooks gets access to Amazon’s resources (financial and technical) and will be able to continue growing their business at breakneck speed. Of course, a well-deserved exit for shareholders and employees is nice as well – some of which have been involved with AbeBooks for over ten years.

Financial details of the transaction haven’t been released but based on my calculations this was a sizable transaction. According to the AbeBooks website, in 2007 they did $190 Million in gross merchandise volume and had 13,500 bookseller members on their platform. Based on AbeBooks’ 13.5% combined commission/service fee and minimum monthly subscription fee of $25, AbeBooks’ revenue in 2007 was approximately $30 Million.

If you look at comparable online e-commerce businesses like eBay with a current market cap of $32 Billion and 2007 annual revenue of $7.6 Billion, it’s safe to say that a revenue multiple of 3-4 would be applicable for AbeBooks. This would put the acquisition price of AbeBooks somewhere in the range of $90-$120 Million. That’s Big!

If my math skills haven’t failed me, this acquisition will take the #2 spot on the Biggest Consumer Internet Transactions in Canada list, behind Disney’s acquisition of Club Penguin ($700 Million) and ahead of Yahoo!’s purchase of Flickr for a rumoured $35 Million.

Important side note: AbeBooks head office will remain in Victoria, BC and the current management team stays put. Congrats to everyone at AbeBooks – gotta love employee share ownership programs!

Disclosure: Boris Wertz is a Director of Techvibes Media Inc. and AbeBooks.

 

Company:
AbeBooks.com
Website:
http://www.abebooks.com
Location:
Victoria, British Columbia, Canada

AbeBooks is an online marketplace for books. Millions of new, used, rare, and out-of-print books are offered for sale through the AbeBooks websites from thousands of booksellers around the world. Readers can find bestsellers, collectors can find rare books, students can find new and used textbooks, and treasure hunters can find long-lost books. AbeBooks Inc. is a subsidiary of Amazon.com, Inc. AbeBooks, an online... more

Company:
Amazon
Website:
http://www.amazon.com
Location:
Vancouver, British Columbia, Canada

Amazon.com, Inc. (NASDAQ:AMZN), a Fortune 500 company based in Seattle, opened on the World Wide Web in July 1995 and today offers Earth's Biggest Selection. Amazon.com, Inc., seeks to be Earth's most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of... more


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Rob Lewis

Rob Lewis

Rob is the President of Techvibes Media and Editor-in-Chief of Techvibes.com.  His diverse background includes stints in International Trade Finance, Web Development, and Enterprise Software and he is a graduate of the University of British Columbia, British Columbia Institute of Technology, and Simon Fraser University. When not running Canada's leading technology media property, Rob can be... more



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