Home shopping specialist pays £7m for Letterbox
Home shopping specialist Findel has bought children's internet retailer Letterbox for£7 million.

Cornwall-based Letterbox was established in 1987 by Deborah Kilmartin and John Williams, after the pair saw a gap in the market for traditional children's gifts and toys.

The gift and toy retailer had revenues of£10 million in the year to August last year. Following the acquisition, the company will continue to operate from its Cornwall headquarters.

Findel chief executive officer Patrick Jolly said: 'This acquisition is the first step in our stated move to complement our existing credit-based home shopping business and expertise with a strong brand aimed at ABC1 customer categories.'

Last month, Findel's home shopping division revealed disappointing preliminary results. Profits fell 21 per cent to£32 million, well below analysts' forecasts of£41 million. The poor results were blamed on a lack of new customers and high marketing costs. However, the retailer said it was encouraged by an increase in internet sales, which it expects to keep rising.