Hyderabad based Ybrant Digital has entered into an agreement to acquire PriceGrabber, LowerMyBills, and ClassesUSA.com from Experian for $175 million. According to the terms of the deal, $100 million is being paid in cash and the rest is a $75 million “loan note”. For the year ended March 31st 2012, revenues from these businesses were $283 million, while EBIT was $20 million. The closure of the deal is contingent on certain terms, including “the initiation in trading in Ybrant Digital Limited shares on the Bombay Stock Exchange”. The Andhra Pradesh High Court recently sanctioned the merger of Ybrant Digital with LGS Global, a BSE listed technology and outsourcing services provider.
The acquisition is expected to close within the first half of the (current) fiscal year. The price being paid by Ybrant is significantly lower than what Experian paid for these businesses in 2005:
– Pricegrabber bought in 2005 for $485 million: PriceGrabber is a comparison shopping engine which powers Yahoo! and MSN shopping.
– LowerMyBills.com in 2005 for $330 million plus an earnout: LowerMyBills is a lead generation business connecting those looking for loans with over 500 service providers across home loans, credit cards, auto and health insurance.
– ClassesUSA.com is an online higher-education portal with 2 million visitors and 300 accredited college and university partners. It was also acquired by Experian in 2005, for an undisclosed price.
So Experian has sold the businesses, a part of Experian Interactive, for less than 21% of the price that they bought them for. The company says in a statement about PriceGrabber and it’s ‘North America online lead generation businesses’: “Both businesses have been non-core to Experian for several years, and the agreed divestment is consistent with Experian’s strategic focus to extend its global lead in credit information and analytics, digital marketing services and direct-to-consumer services.”
With this acquisition, Ybrant’s employee strength will increase by 300, and its revenues will nearly double; Steve Krenzer, President of Experian Interactive, will join Ybrant. Note that Experian also has an India business.
Ybrant’s buying spree
This is Ybrant’s second significant property acquisition: in 2010, it acquired Lycos for $36 million in an all cash deal. Over the past few years, Ybrant has acquired Australian ad network company Max Interactive, Israeli ad firm Oridian ($13.5 million), US-based DW Net Ventures LLC / MediosOne ($4 million), Serbia-based Seenetix for its flagship bulk emailing product VoloMP ($2.2 million) and US- based Pennyweb Inc ($10 million) and Argentina based ad network DreamAd. Last year, Ybrant Digital raised $48 million in fresh financing, in debt and equity from Oak India Investments, Asia Pacific Capital, and ICICI Bank.
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