IAC/InterActiveCorp announced on Monday it has proposed to Ask Jeeves, Inc., in an estimated $1.85 billion all-stock deal, less the cash and equivalents Jeeves has in its bank accounts, to which Ask Jeeves replied that it has accepted the marriage proposal.
The two companies’ boards of directors have approved the deal that would see Ask Jeeves shareholders receive 1.2668 IAC shares for each Ask Jeeves share they hold. Apparently, Barry Diller, who is Chair and Chief Executive Officer of IAC, had wanted to pay mostly cash but Steve Berkowitz preferred the all-stock deal so its employees could cash in the future fortunes of publicly-traded IAC – whenever the common stock of IAC decides to tick upwards, that is. And, Berkowitz, who is President and CEO of Ask Jeeves, openly admitted it in articles circulating on various online news Web sites.
IAC said its statement that it expects the transaction to close near the end of its fiscal second quarter or into the third quarter prior to the spin-off of the IAC Travel business, a collection of travel related Web properties that will be spun-off as a separate publicly-traded company under the Expedia moniker and owned by IAC shareholders. As well, it expects Jeeves, which will operate as an independent, wholly-owned subsidiary of IAC, to be accretive to 2005 earnings.
So, a look at what both companies own:
Ask Jeeves owns its flagship Ask.com and Ask.co.uk search Web sites, algorithmic search engine technology Teoma, AJkids, and Bloglines, a blog aggregation and self-publishing service it bought earlier this year for an undisclosed sum. It also owns the Excite, iWon, MySearch, MyWay, and MyWebSearch properties, MaxOnline online advertising network, and Fun Web Products adware purveyor that it collectively bought when it acquired Interactive Search Holdings Inc. in May 2004. Plus, it has a cool desktop search product that it developed since it bought the assets of privately-held Tukaroo Inc. in June 2004 and its personalized search and social networking-type site MyJeeves.
IAC is a huge Internet e-commerce, retailing, ticketing, and services business that owns a bunch of companies through its nine business lines. Some of which include CitySearch, Entertainment Publications, Evite, Home Shopping Network, LendingTree, newly-launched shopping comparison and gift idea Web site Gifts.com, social networking site Zero Degrees, Match.com, Udate.com, and Ticketmaster.