Card Factory has agreed to buy online firm Funky Pigeon from WH Smith for £24 million as it looks to boost its web offering.

Funky Pigeon, which operates out of Guernsey and Bristol, specialises in personalised cards and gifts and makes around £32 million in sales on average a year.

Card Factory – which has over 1,000 stores across the UK – said it wants to expand its online business, with Funky Pigeon’s technology platform set to be the basis for its digital business in the UK and Ireland “over time”.

It claims the deal will see it become the UK’s second largest online card and related gift retailer.

But it comes just six months after Card Factory shut its online gifting site gettingpersonal.co.uk at the end of January.

Shares in Card Factory lifted 7% in noon trading on Tuesday.

Darcy Willson-Rymer, Card Factory’s chief executive, said: “This acquisition marks a significant step forward in Card Factory’s strategy to build a scaled, competitive digital presence in the celebration occasions market.

“It brings a high-quality platform and proven technology, accelerating our ability to compete in the direct-to-recipient card and gifting segment, so supporting our ambition to become the leading omnichannel retailer in our sector.”

The deal comes as WH Smith continues to focus attention on its stores based at travel sites, having recently sold off its 230-year-old high street retail business to investment firm Modella Capital.

Funky Pigeon was hit by a cyber attack in April 2022 that left it unable to process orders for several days.

Card Factory said it plans to make operational savings by using Funky Pigeon’s order fulfilment capability in Guernsey for personalised cards, and Card Factory’s factory and order-fulfilment operation in Baildon, West Yorkshire, for card and gift orders.

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