Shares in Auction Technology Group plummeted on Monday following the firm's decision to expand its borrowing burden through the £64 million ($85 million) purchase of furniture marketplace Chairish.
The London-listed business revealed it had boosted its revolving credit facility to $275 million to support the transaction, which was financed through a mix of cash and borrowing.
The takeover of the 12 year old e-commerce platform Chairish, which is currently loss-making, is expected to increase the company's debt burden in the near term.
Auction Technology's stock price collapsed by as much as 21 per cent during early trading on Monday morning, erasing over £100 million from its market capitalisation. The shares have declined by approximately one-third since the beginning of the year.
The business stated that its purchase "benefits from operational synergies and unlocks multiple growth opportunities," with the synergies valued at an estimated $8 million.
Chairish's growth outlook
Chairish, which runs a marketplace specialising in vintage furniture, décor and art, generated revenues of $51 million in 2024 from commission fees, seller subscriptions, marketing charges and shipping income.
The San Francisco-headquartered company has facilitated the sale of over one million items through its platform since launching, with approximately 80 per cent of transactions originating from the US and the balance from Europe.
The business has attempted to leverage the wave of import duties imposed on American consumers by US President Donald Trump by emphasising that vintage furniture available on its platform was "tariff-free."
In May, the number of first-time buyers surged nearly 11 per cent year on year, indicating early signs of success for the campaign.
Auction Technology anticipates that the company will contribute to its adjusted pre-tax earnings in 2026 and boost its adjusted earnings per share in 2027.
CEO John-Paul Savant praised Chairish's "strong brand, curated inventory, and loyal community enhance our position in the Arts & Antiques category and broaden our reach across high-intent buyers and quality sellers."
"Together, we expand channel choice, increase marketplace liquidity, and unlock near-term commercial value – including meaningful cost synergies."
