Speed Commerce To Divest Retail Distribution Business

(RTTNews) - Speed Commerce Inc (SPDC) said Monday it has commenced the process of divesting its legacy distribution business segment, which is engaged in the retail distribution of computer software and consumer electronics and accessories. The process is part of plans to allocate resources toward the high-growth, higher-margin e-commerce services segment, the company said.

In the first nine months of fiscal 2014, sales in the legacy retail distribution business declined 7 percent from last year, while revenues generated by e-commerce services grew 150 percent.

"This planned divestiture is consistent with our goal of leveraging the company's competitive advantages and superior customer solutions in the fast-growing e-commerce services sector," said CEO Richard Willis.

The company intends to use the proceeds from the divestiture to pay down a portion of its line of credit, as well as support the continued growth of its e-commerce business.

Speed Commerce expects to close on a potential transaction during the first half of its fiscal 2015.

The distribution business segment will be reclassified as discontinued operations in the company's fiscal fourth quarter 2014 financial results, which will be issued in May.

Dallas-based Speed Commerce provides multi-channel platform of e-commerce services and distribution solutions to retailers and manufacturers.

Speed Commerce stock closed Monday at $3.64, up $0.12 or 3.41%, on a volume of over 1 million shares on the Nasdaq.