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E-Commerce Industry Insight September 2020

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E-Commerce Industry Insight September 2020 www.peakstone.com E-Commerce Industry Insight September 2020 E-Commerce Industry Insight | September 2020 E-Commerce – M&A Market Overview E-Commerce transaction activity has been strong with favorable valuation trends U.S. Number of Transactions by Buyer Type U.S. E-Commerce Transaction Multiples 28.5x 28.5x 27.8x 7 1 7 5 8 4 3 5 16.8x 12.2x 15.2x 6 13.2x 54 53 48 10.8x 44 44 45 7.9x 40 36 8.0x 25 2.0x 0.9x 0.7x 0.7x 0.7x 1.0x 1.1x 0.7x 2012 2013 2014 2015 2016 2017 2018 2019 2020 2012 2013 2014 2015 2016 2017 2018 2019 2020 YTD YTD Strategic Financial EV / EBITDA EV / Revenue Source: Capital IQ, data as of September 2020. www.peakstone.com 1 E-Commerce Industry Insight | September 2020 Peakstone E-Commerce Index – Trading Statistics Relative Stock Performance 140% 120% E-Commerce: 116% 100% S&P 500: 69% 80% 60% 40% 20% 0% -20% -40% Peakstone E-Commerce Index AMZN, BABA, EBAY, W, ASC, VIPS, STMP, SFLY, LE, PETS, FLWS, OSTK Source: Capital IQ, data as of September 2020 Note: Peakstone indexes are equally weighted www.peakstone.com 2 E-Commerce Industry Insight | September 2020 Peakstone E-Commerce Index – Trading Statistics Comparable Valuation Trends – Enterprise Value / EBITDA 25.0x 20.0x S&P 500: 12.5x E-Commerce: 12.0x 15.0x 10.0x 5.0x 0.0x Peakstone E-Commerce Index AMZN, BABA, EBAY, W, ASC, VIPS, STMP, SFLY, LE, PETS, FLWS, OSTK Source: Capital IQ, data as of September 2020 Note: Peakstone indexes are equally weighted www.peakstone.com 3 E-Commerce Industry Insight | September 2020 Selected Public Trading Comparables Peakstone E-Commerce Index ($ in millions) Market Enterprise Enterprise Value / Forward Gross EBITDA Company Name Cap Value Revenue EBITDA EBIT P/E Ratio Margin % Margin % E-Commerce Amazon.com, Inc. $1,550,319 $1,570,329 4.9x 35.2x 94.4x 88.7x 40% 12% Alibaba Group Holding Limited 733,471 715,613 9.2x 34.1x 51.0x 27.6x 45% 27% eBay Inc. 36,730 40,518 3.6x 11.3x 15.2x 14.4x 77% 30% Wayfair Inc. 28,020 28,595 2.5x NM NM NM 26% -3% Vipshop Holdings Limited 11,478 10,269 0.8x 9.6x 12.7x 12.0x 22% 7% ASOS Plc 6,772 7,389 1.9x 50.4x 89.2x 48.2x 48% 4% 1-800-FLOWERS.COM, Inc. 1,611 1,533 1.0x 10.4x 19.0x 21.8x 42% 8% Overstock.com, Inc. 3,115 2,930 1.6x NM NM NM 22% -2% Stamps.com Inc. 4,184 3,953 6.0x 23.9x 29.7x 34.7x 74% 24% Lands' End, Inc. 471 837 0.6x 9.2x 18.5x 120.5x 42% 6% PetMed Express, Inc. 622 535 1.8x 14.6x 15.5x 19.2x 29% 12% E-Commerce Median $5,478 $5,671 1.9x 12.9x 18.7x 24.7x 42% 9% 0 Total E-Commerce Median $5,478 $5,671 1.9x 12.9x 18.7x 24.7x 42% 9% Source: Capital IQ, data as of August 2019 www.peakstone.com 4 E-Commerce Industry Insight | September 2020 Selected Precedent M&A Transactions Selected E-Commerce Transactions Transaction Date Target / Issuer Size ($mm) Buyers / Investors EV / EBITDA Transaction Comments Flight Centre Travel Group Limited (ASX:FLT) acquired WhereTo on June 12, 2020. Flight Centre Travel Group 08/05/2020 WhereTo $13 - Flight Centre will integrate WhereTo into products and services in both its Limited (ASX:FLT) Corporate Traveler and FCM Travel Solutions brands. 800-Flowers, Inc. entered into an Equity Purchase Agreement to acquire 02/18/2020 PersonalizationMall.com, LLC $245 800-Flowers, Inc. - PersonalizationMall.com, LLC from Bed Bath & Beyond Inc. (NasdaqGS:BBBY) for approximately $250 million on February 14, 2020. Five Sears Outlet Stores Of A Team Sales, LLC acquired five Sears Outlet stores from Franchise Group, Inc. 10/23/2019 $15 A Team Sales, LLC - Franchise Group, Inc. (OTCPK:FRGA) for $15 million on October 23, 2019. Driven Deliveries, Inc. (OTCPK:DRVD) signed a letter of intent to acquire Budee Inc. Driven Deliveries, Inc. 08/27/2019 Budee Inc. $12 - for $10.3 million on August 27, 2019. Driven Deliveries, Inc. (OTCPK:DRVD) signed a (OTCPK:DRVD) definitive agreement to acquire Budee Inc. on February 27, 2020. Steven Madden, Ltd. (NasdaqGS:SHOO) acquired Greats Brand, LLC for $17.8 Steven Madden, Ltd. 08/12/2019 Greats Brand, LLC $18 - million on August 9, 2019. The acquisition was completed for $12.8 million in cash (NasdaqGS:SHOO) net of cash of 0.29 million, plus an earnout of $5 million. Etsy, Inc. (NasdaqGS:ETSY) entered into an agreement and plan of merger to 07/22/2019 Reverb Holdings, Inc. $275 Etsy, Inc. (NasdaqGS:ETSY) - acquire Reverb Holdings, Inc. for approximately $280 million on July 21, 2019. Source: Capital IQ, data as of August 2019 www.peakstone.com 5 E-Commerce Industry Insight | September 2020 Selected Precedent M&A Transactions (cont.) Selected E-Commerce Transactions Transaction Date Target / Issuer Size ($mm) Buyers / Investors EV / EBITDA Transaction Comments Certain funds managed by Apollo Global Management, LLC entered into a definitive Apollo Global Management, 06/10/2019 Shutterfly, Inc. $2,931 10.0x agreement to acquire Shutterfly, Inc. (NasdaqGS:SFLY) for $1.9 billion on June 10, Inc. (NYSE:APO) 2019. PlanetArt entered into a non-binding letter of intent to acquire Provide Creations, 06/03/2019 Provide Creations, Inc. $18 PlanetArt, LLC - Inc from FTD Companies, Inc. (OTCPK:FTDC.Q) on June 3, 2019. PlanetArt entered into a definitive asset purchase agreement to acquire Provide Creations, Inc. Oisix ra daichi Inc. (TSE:3182) agreed to acquire Three Limes, Inc. from Andy Levitt, 04/25/2019 Three Limes, Inc. $30 Oisix ra daichi Inc. (TSE:3182) - Brian Greenfield and other shareholders for $21 million on April 24, 2019. The consideration includes the earn-out consideration at $17 million. World Co., Ltd. (TSE:3612) agreed to acquire an additional 53.2% stake in Original, 03/25/2019 Original, Inc. $20 World Co., Ltd. (TSE:3612) - Inc. from Jin Koh for approximately ¥2.2 billion on March 25, 2019. Under the terms, World Co. will acquire 0.91 million shares. Expedia Group Inc. (NasdaqGS:EXPE) (‘Expedia’) made a proposal to acquire Liberty Expedia Group, Inc. 02/04/2019 Liberty Expedia Holdings, Inc. $22,436 10.6x Expedia Holdings Inc. (NasdaqGS:LEXE.A) (‘Liberty’) from John C. Malone, T. Rowe (NasdaqGS:EXPE) Price Associates, Inc., Dimensional Fund Advisors L.P., The Vanguard Group, Inc. Farfetch Limited (NYSE:FTCH) entered into a definitive agreement to acquire 12/12/2018 Stadium Goods $250 Farfetch Limited (NYSE:FTCH) - Stadium Goods for $250 million on December 12, 2018. Source: Capital IQ, data as of September 2020 www.peakstone.com 6 E-Commerce Industry Insight | September 2020 Peakstone Selected E-Commerce Transactions E-Commerce E-Commerce E-Commerce E-Commerce M&A Advisor M&A Advisor Financial Advisor Financial Advisor PAG Capital E-Commerce E-Commerce E-Commerce E-Commerce M&A Advisor & Strategic Advisor M&A Advisor M&A Advisor Principal www.peakstone.com 7 E-Commerce Industry Insight | September 2020 Peakstone Momentum M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor Strategic Investor & Financial Investor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor M&A Advisor www.peakstone.com 8 E-Commerce Industry Insight | September 2020 Contact Us About Peakstone Peakstone is an investment bank that specializes in mergers and acquisitions advisory and capital raising for middle market clients. Our team is comprised of senior investment banking professionals who have decades of experience and have executed hundreds of transactions totaling billions of dollars. For additional information, visit www.peakstone.com. Contact Alex Fridman Gerald Bobal Managing Director Analyst [email protected] [email protected] 312-204-7300 312-204-7347 www.peakstone.com 9.
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