Dunelm buys Achica and Kiddicare

Dunelm has purchased Worldstores, which owns online retailers Achica and Kiddicare, in a deal worth £8.5 million.

Worldstores, which was established in 2008, generates annual revenue of around £100 million and has 650 employees. It claims to be one of the UK's largest online retailers of products for the home and garden, selling over 500,000 products. Achica is a members-only flash-sale website selling furniture, home and accessories, while Kiddicare sells childrens' merchandise.

Dunelm's purchase of the company will give it access to the internally built proprietary technology platform that manages suppliers and enables shipping directly from supplier to customer offering next-day, or chosen-day delivery.

CEO of Dunelm, John Browett, said: "We are excited by this opportunity to accelerate the growth of our internet operation, more than doubling its size, and enhancing our position as the destination Homewares retailer in the UK, both online and offline. Between the store network, broad product range and strong brand that Dunelm has built and Worldstores' extensive homewares and furniture offer and unique platform for next day delivery and flash sales, we will strengthen our leading position as the UK's Home of Homes."

Dunelm expects to benefit from the purchase in the region of £10 million per annum in the short-medium term, this will be from improvements to its performance by sharing product ranges and advancing its multichannel delivery proposition.

The retailer also said it plans to plough £15 million into the new acquisition, while Worldstores management, including the founders, will continue to run the business.

Richard Tucker and Joe Murray, Worldstores' founders, added: "We're delighted to be working with Dunelm, in whom we have found a partner who shares our vision for our company and brands, and is backing our ambitious plans for growth."

Worldstores is expected to make a trading loss of £5-10 million in Dunelm's financial year ending 1 July 2017, while in the first full year of the acquisition, ending 30 June 2018, it is expected that the new addition to Dunelm's portfolio will at least break even.