NEW YORK: IAC/InterActiveCorp, an Internet conglomerate run by media mogul Barry Diller, is near a deal to buy web-search service Ask Jeeves Inc, sources familiar with the matter said.
The Wall Street Journal, which first reported the deal, said IAC would pay US$2bil in stock, a 40% premium to Ask Jeeves market capitalisation on Friday. Neither Ask Jeeves nor IAC, however, were immediately available for comment.
IAC has a variety of Internet businesses, including Home Shopping Network, Web directory Citysearch and online mortgage provider LendingTree. It also owns travel website Expedia, which it plans to spin off.
Ask Jeeves web site Ask.com is known for its cartoon butler mascot Jeeves, who was known during the Internet boom of the late 1990s for providing the answer to queries made in the form of a question.
The reported price implies IAC would pay about US$33.90 a share for Ask Jeeves, compared with a close of US$24.24 last Friday on Nasdaq. That would be below the 52-week high of US$44.66 the stock hit last April and the US$34.99 it closed at on Oct 27, when the company reported earnings that sparked worries about growth and pushed the stock down 24% in one day.
Other Internet companies have also received rich valuations recently as they have become hot properties once again. The New York Times Co, for instance, agreed to buy information portal About.com for US$410mil while Dow Jones & Co Inc paid US$528mil for financial news web site MarketWatch.
Ask Jeeves would be one in a stream of acquisitions for IAC, which earlier this month said it would buy catalogue and online retailer Cornerstone Brands for US$720mil to expand across multiple retail outlets. Reuters
Did you find this article insightful?