There have been some major alliances between some major competitors for example Amazon.com and Toys ?R? Us, Wal-Mart, Kmart?s Bluelight.com and Target. Last year, Amazon.com?s toys and related business brought in $95 million in sales, comparable to EToys? $107 million. EToys has shifted its product mix to specialty retail and private-label products from traditional mass-market products, which may affect the profitability target. And Wal-Mart has implied that it will keep improving their Web site and may become a major online player by Christmas of 2001.
eToys? received a $40 million revolving credit facility from Foothill Capital Corp. It will use funds from the two-year facility, which is backed by certain company inventory, for working capital and general purpose. The Wall Street Journal said in September that eToys? needed about an additional $100 million to sustain its operations until profitability.
eToys? Inc. entered into an amended agreement with shareholders of its series D convertible preferred stock, according to a Form 8-K filed November 18 with the securities and Exchange Commission. The preferred shareholders waived their rights to enter into a short sale of eToys? stock.
Shareholders also agreed to waive their right to convert the preferred stock at any time if eToys? common stock fell below $3 a share for 10 consecutive days. eToys? common shares originally closed below $3 on Nov. 8, dropping 78 cents to $2.56 a share. Since that time, eToys? shares haven?t closed above $3.
They submitted to the shareholders a conversion election notice for 2,000 shares of the convertible preferred stock. eToys? issued 10,000 shares of the convertible preferred stock. They agreed to provide at least 1,000 preferred shares by Jan. 1 for a conversion to take place after Jan. 31 to shareholders with a conversion option.
Bibliography
VIII. References
http://www.wsj.com
Wall Street Journal
http://www.Excite.com
http://www.eToys.com
http://www.gartner.com
http://www.cbs.marketwatch.com
http://www.quicken.com/news