Online retailer Boxed.com has been acquired by New York-based MSG Distributors Inc. in an all-cash transaction.
MSG, a regional distributor of consumables and household essentials, said in a release that the Boxed acquisition also included various intellectual property portfolios such as the boxed.com domain name, customer data, and trademarks, plus social media accounts and related items. MSG also acquired Boxed affiliates or independent promoters who earn a commission based on the sales they contributed (collectively called Boxed).
“This acquisition strengthens our inorganic growth strategy and diversifies our distribution models nationwide. The loyalty and trust that customers and brands have in Boxed is priceless, and we are committed to continuing this model of offering bulk-sized products to customers at wholesale prices,” said MSG President Mark Gadayev.
Earlier this year in January, Boxed said it was exploring strategic alternatives for the business, including a potential sale of the company, even though it still saw the potential in online grocery delivery to consumers as a potential growth pillar.
Then, the company announced later that month that it had secured up to $20 million in its quest for either profitability or a sale of the company.
According to Boxed, at that time the company would receive $10 million in funding from an unknown lender by entering into a second-lien-secured term loan facility. The company would then receive an additional $10 million in funding subject to the completion of certain milestones in the process of selling the operation.
The acquisition news comes after Boxed filed for Chapter 11 bankruptcy protection in April. According to the Chapter 11 filing at the time, Boxed total assets sat at just over $102.5 million, while total debts were just over $190 million. CEO and Co-founder Chieh Huang said in a statement that it was an incredibly difficult decision and one that was reached only after carefully evaluating and exhausting all available options.
The acquisition price was not disclosed, “but it’s not likely a high-value deal for a company that had raised north of $318 million through its lifetime,” according to data from PitchBook and reported by TechCrunch.
MSG said that it shares the Boxed commitment “to providing exceptional products for businesses and consumers” and its existing infrastructure makes it the ideal choice to revitalize the Boxed.com brand.
Under MSG’s new ownership, Boxed customers will receive expedited delivery services such as next-day delivery, and they will have access to a catalog of new items and brands including grocery and home goods.
Gadayev also said that MSG plans to further enhance its capacity for processing and distribution to Boxed customers across the U.S.