updated 12:15 am EDT, Wed April 25, 2012
'Stalking horse' bid was only offer
As reported in March, photo gallery and printing service Shutterfly has now successfully acquired Kodak Gallery from Eastman Kodak as the latter sells off assets as part of its restructuring. Shutterfly made an early "stalking horse" bid of $23.8 million on the service, which has some 75 million users, but no other offers emerged. Kodak Gallery itself was created by Kodak's purchase of Ofoto, for which it paid less than $100 million back in 2001. Members of Kodak Gallery will be transferred to Shutterfly accounts.
Shutterfly reported 5.3 million visitors (an all-time high for Shutterfly) in March, along with another million or so for its Tiny Prints acquisition. While Kodak Gallery has more customers, traffic has fallen severely in recent months as the troubled photography giant's problems became widely known. In March, the service saw just under a million unique visitors.
In the deal, Shutterfly will gain considerably from Kodak's more world-wide reach of users. Shutterfly is an almost exclusively US-based service currently. The company posted increased revenues of $473 million in 2011, but saw its net income fall to $14 million, according to The Wall Street Journal.
The Kodak Gallery has posted a FAQ that answers customers' most common questions about how the transition to Shutterfly will affect them and their photo galleries. [via The Wall Street Journal]