Liberty Interactive, the parent company of QVC, has entered into an agreement to buy its longtime rival, HSN Inc., for $2.1 billion in stock.
The deal will, for the first time, bring the two TV shopping giants completely under one roof.
Liberty Interactive already owns 38.2 percent of HSNi. Under this agreement, it will acquire the remaining 61.8 percent and turn it into a wholly owned subsidiary.
While jewelry is no longer as important to the TV channels as it once was, the sector is still a decent part of their business. For fiscal year 2016, jewelry represented 9 percent of QVC’s sales, down from 10 percent the prior year. That same year, 7.9 percent of HSN’s sales were from jewelry, down from 8.4 percent in 2015.
In a statement, Liberty Interactive touted the following benefits to the acquisition: synergies from cost reduction and revenue opportunities; cross-marketing between existing and potential customers; and increased development of the channels’ e-commerce and mobile platforms.
“There is so much change going on in retailing,” QVC CEO Mike George told CNBC. “It just felt like in a world of rapidly changing technology, [a] rapidly changing retail landscape, now is the time to combine forces…[so] we compete that much more strongly in the broader retail marketplace.”
The acquisition will also make the new company a substantial player in e-commerce. According to the New York Post, the combined entity will trail only Amazon and Walmart in digital sales in North America.
This is QVC’s second notable acquisition in recent years. In 2015, it snapped up flash site Zulily for $2.4 billion.
Under the deal, HSNi shareholders will receive 1.65 shares of QVC stock for every share of HSN stock.
The acquisition is expected to be completed by the fourth quarter of 2017 and is subject to regulatory approvals.