Baby and toddler merchandise retailer Baby Universe has just cashed in on a $2.5 million transaction with one "large institutional investment fund," Internet Retailer wrote.

The company plans to disseminate 317,259 shares of Series A convertible preferred stock and warrants to acquire 79,316 shares to convert to common stock, provided the merger with eToys Direct closes later this year as planned.

The investment was priced at the stock's market value, which as set at $7.88 per share, the common stock's closing price as of May 24.

Baby Universe is an online retailer that also provides online content, including streaming video, for parents and parents-to-be.