UK-based greeting card and gifting platform Moonpig Group has agreed to acquire the entire issued share capital of gift experiences platform Smartbox Group UK (Buyagift) for £124m ($156.04m).

Buyagift serves 3.3 million customers under its two brands, Buyagift and Red Letter, and recorded double-digit revenue growth at a combined annual growth rate (CAGR) over the last ten years.

The company partners with more than 4,400 companies and has a broad geographical presence in the UK.

The acquisition is in line with Moonpig’s strategy to elevate and strengthen its position in the gifting market.

It opens Moonpig’s entry into the £6bn UK gift experiences segment and digital delivery of gifts (gift-in-a-card), as well as the same-day gifting market.

Moonpig Group CEO Nickyl Raithatha said: “The proposed acquisition of Buyagift rapidly accelerates Moonpig Group’s journey to become the ultimate gifting companion.

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“There is strong strategic rationale for the transaction, and compelling financial benefits.

“Buyagift is profitable and highly cash generative, with a proven track record of strong growth and we are excited by the ways that we can further transform the business using the group’s proven playbook.

“We see significant potential for the cross-selling of gifting experiences to Moonpig Group’s loyal customers.

“We look forward to working with the Buyagift team to deliver an enhanced proposition for our customers and to create value for our shareholders.”

The deal is expected to close by the end of July subject to receiving UK regulatory clearance.

Moonpig expects its revenue for the fiscal year 2023 (FY23) to be approximately £350m if the deal closes on schedule.

The company also expects medium-term revenue growth for Buyagift and an underlying revenue growth percentage in the mid-teens for the combined group.

Last February, Moonpig reported a 25% rise in its share price after presenting an initial public offering (IPO) on the London Stock Exchange.