Homewares and furnishings retailer Dunelm has bought baby and infant goods specialist Kiddicare as part of an £8.5m acquisition of UK online shopping group Worldstores (WS Group) in a bid to boost its online offering.

The news makes Dunelm the latest in a line of new owners for Kiddicare, which was bought by supermarket chain Morrisons for £70m in 2011 before being sold to private equity owners for £2m just three years later. Kiddicare was then bought by Worldstores in 2014, where it joined the group's portfolio of home and furniture websites.

Worldstores has annual revenue of about £100m, but is expected to make losses of £5m to £10m this year. Despite this, Dunelm's ceo John Browett remains positive about the move, stating: "We are excited by this opportunity to accelerate the growth of our internet operation, more than doubling its size, and enhancing our position as the destination homewares retailer in the UK, both online and offline."

Dunelm said all three brands complement its existing offer and that it will be able to improve performance by sharing product ranges, harmonising terms and extending the multichannel delivery proposition. It expects the benefits to be in the region of £10 million per annum over the short to medium term.

Dunelm will also be putting £15 million into the newly-acquired company to retain the current management team and expects Worldstores to break even in the year ending 30 June 2018.

“Between the store network, broad product range and strong brand that Dunelm has built and Worldstores' extensive homewares and furniture offer and unique platform for next day delivery and flash sales, we will strengthen our leading position as the UK's home of homes," said John.

Dunelm, which started on a Leicester market stall in 1979 and now has more than 140 outlets across the UK, claims the deal will more than double the size of its current internet operation.