Mirakl ‘actively seeks’ targets in Europe, North America for 2023-24 acquisition – CFO

Interview 27 February

Mirakl ‘actively seeks’ targets in Europe, North America for 2023-24 acquisition – CFO

Mirakl, a French online marketplace solutions provider, is “actively seeking” potential acquisition targets in both Europe and North America, CFO Eric Heurtaux told Mergermarket.

Hertaux declined to name specific target countries, saying that the company bases its M&A strategy on how it can grow its product by acquiring tech companies which can be easily integrated into its platform, rather than on geography.

Mirakl, which generated EUR 135m annual recurring revenue (ARR) in 2022, sources deals in-house, he said. It has no set calendar for acquisitions, he said, but it is “far from impossible” that the company could complete one or more deals this year, or could postpone the process until 2024.  

Targets would be retail media, online payment and fulfillment experts, he said, adding that for its B2B customer base, it would look into companies making payment solutions tailored for this specific market.

The Paris-headquartered company does not have size criteria when it comes to potential acquisitions, Heurtaux said. Mirakl has “a lot” of cash on hand for its M&A strategy following its most recent fundraise, which it has not yet tapped, he added. 

However, if the company has good financing opportunities, it might also secure debt, as it did for the acquisition of Target2Sell last year, he added. Mirakl bought Paris-based AI platform publisher Target2Sell for an undisclosed amount last April, as reported.

Stable IPO route

Mirakl has “not slowed down” when it comes to preparing for a potential listing, Heurtaux said, and is still discussing its listing with several potential advisors, although it has not mandated any yet.

The company is among a number of French unicorns itching for a listing by 2024, an ECM banker and a tech banker agreed. 

However, 2023 is not expected to offer an IPO window for French tech unicorns, as market conditions are not as stable as in 2021, when French start-ups including cloud storage provider OVH [EPA:OVH] and digital music company Believe [EPA:BLV] listed, the ECM banker said. 

Believe and OVH have since seen their share prices decrease as tech values took a beating worldwide with the return of inflation and interest-rates hikes, the banker said. 

Unicorns which raised pre-IPO funds before 2022 at attractive valuations cannot deliver on their ambitious growth objectives in current market conditions, the banker said. Therefore, tech unicorns like Mirakl would rather come back with listing plans in 2024, provided inflation and market conditions stabilise this year, he added. 

In the meantime, start-ups could either work on new pre-IPO rounds or seek growth by making targeted acquisitions and entering new markets to build up their equity stories, the bankers agreed. 

Mirakl could consider a new funding round if an interesting opportunity arises, Heurtaux said. However, the company does not have a set agenda regarding a potential exit and could go on “for a long time” without needing more funding, he said, declining to give further details.

In 2012, Mirakl raised a EUR 2.5m Series A led by Elaia Partners, followed by a USD 20m Series B with 83North, Felix Capital and Elaia Partners three years later. Bain Capital Venturesled its USD 70m Series C round in 2019. In 2020, Mirakl was valued USD 1.5bn after its USD 300m  Series D led by Permira.  The company completed its most recent fundraise, a USD 555m in Series E led by Silver Lake which valued it more than USD 3.5bn, in 2021.

Mirakl registered EUR 6bn gross merchandise volume last year, according to a press release. The company grew by around 40% last year, co-founder and co-CEO Philippe Corrot said at a press conference held on 14 February. 

Although the company is not profitable right now, it is “fairly close” to achieving profitability but would rather focus on investing and growth, Heurtaux said. Heurtaux, who joined the company last year, was nominated in order to support the company’s growth and control its cost structure and its cash-burn, he said. 

When asked about the current valuation drop in the tech market, Heurtaux said Mirakl has the right product for today’s market as it is extremely adaptable and can sustain in both easy markets and times of inflation.

“Mirakl’s platforms enable consumers to access a very large product offering and find the best price, which makes the company resilient even in a difficult context both for tech and for retail”, he added.

Established in 2012, Mirakl has 750 employees in 16 countries, including in the US, Japan and Brazil, group CHR Patrick Houry said during the press conference. Most of Mirakl’s revenue (80%) comes from outside France and 84% of its gross merchandise volume comes from its B2C activity, Carrot said at the same event.

COO Florian Bressand named Brazilian e-commerce platform VTex [NYSE: VTEX] as one of the company’s indirect competitors.

By April, Mirakl aims to divide its activities into three business units: Mirakl Payout, which aims to reduce operating cost and regulatory burden and simplify seller payments; Mirakl Ads, to monetise website traffic; and Mirakl Target2Sell, which enables marketplace personalisation at scale, co-founder and co-CEO Adrien Nussenbaum said at the press conference.

Last year, Mirakl signed the French parity pact, in addition to the climate act it agreed to in 2021, Chief Impact Officer Sophie Milochevitch said at the event.

Mirakl features seventh in Dealogic’s most Likely to Issue (LTI)* ranking of French sponsor-backed companies that could see an exit through an IPO in the next 12 months, with a score of 16.57 as of the time of publication.  

by Myriam Mariotte, with additional reporting by Arezki Yaïche in Paris

*Dealogic’s Likely to Issue (LTI) predictive algorithm is based on a number of key industry, holding behaviour, and dealflow criteria. Dealogic’s platform assigns an LTI score to each exit opportunity, with a higher score corresponding to a higher likelihood for an imminent transaction.

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