Two months ago, the Corum Group, a boutique Seattle M&A advisory firm, floated an idea that Amazon.com should buy retail kiosk pioneer Coinstar. We wrote about it, noting at the time that it was one tech prediction that made a ton of sense.
We noted: “Amazon’s lack of a retail presence — while a huge advantage in the past — is a weakness at a time when the online and offline worlds are colliding in fascinating ways.”
Well, if Amazon.com, which has been experimenting with in-store pick-up locations with Amazon Lockers, may need to act fast if it is going to get in on the Coinstar bidding. A report out today by the New York Post says that the Bellevue maker of the coin-counting and Redbox movie rental kiosks is currently in talks with private equity firms about a possible sale.
Coinstar isn’t commenting on the “rumor and speculation,” but the Post notes that private-equity firms “like businesses that require little capital investment and have steady streams of profit.” Coinstar had net income of $90 million for the six-month period ending June 30.
Coinstar’s stock is jumping on the news, up more than nine percent in trading today. It now has a market value of $1.6 billion, which would make the company one of the pricier deals for Amazon. Past purchases for the online retailer include Kiva Systems and Zappos, but both of those had price tags under $1 billion.
Here’s what Corum’s Jon Scott had to say about a possible Amazon-Coinstar tie-up back in June.
“It’d be a retail jumpstart on a secure channel for Kindle and other high margin items, like its accessories and Amazon published books – simple items that could be dispensed like DVDs.”
So, what do you think? Believe we’ll see Amazon counting its coins in order to gobble up Coinstar?