Card Factory will open its first stores in the US after the acquisition of Garven for $25 million

Greetings card retailer Card Factory will open its first stores in the US market after acquiring Minnesota-based Garven in a $25m (£19.7m) all-cash deal.

The group told shareholders that the acquisition of Garven, which supplies a customer base of general and specialist retailers, provides the opportunity to “further explore design and purchasing synergies… (and) introduce its own ranges in the United States wholesale market.

The U.S. market for gifts and holiday essentials is the largest of its kind globally, according to Card Factory, with an estimated value of about $70 billion.

Card Factory boss Darcy Willson-Rymer said the deal marks an “important strategic milestone”.

‘Together with our independent wholesale supply agreement covering more than 1,100 stores across the United States, it establishes a physical presence in the US market.

“International partnerships are a key component of our growth strategy.”

Card Factory recently reported a more than 40 percent drop in first-half profits as it faced higher staff and transportation costs, but noted that inflationary pressures were easing since early August.

The group said Thursday it had been “encouraged” by operations at the start of its crucial holiday trading season and would provide more guidance in January.

Card Factory Stock it soared 7.2 per cent to 96.8p at midday on Thursday. However, they have fallen more than 30 percent since late September on fears of higher costs.

The group said an ongoing program of productivity and efficiency savings “remains underway” and its expectations for the full year remain unchanged.

UBS analysts say these guarantees “should be welcomed by the market.”

They added: “As things stand, the stock is trading at a 40 per cent discount to its 10-year historical average despite offering a stabilized core business with significant upside potential due to geographical expansion.”