CNET To Devour Competitor Ziff-Davis
Online technology information company CNET Networks Inc. said today it aims to buy competitor Ziff-Davis Inc. in an all-stock deal valued at $1.6 billion.
The deal will cover the remains of Ziff-Davis - which has already sold its stable of well-known computer magazines and the cable TV channel ZDTV - plus its ZDNet online unit, which it recently spun off.
CNET said in a statement today that each Ziff-Davis share will be converted into 0.3397 of a share of CNET stock, while each ZDNet share will be converted into 0.593 of a share.
CNET said it expects to issue approximately 50 million shares of common stock in the transaction, which it valued at $1.6 billion on the basis of Tuesday's closing price of $32.19. It said current holders of the Ziff-Davis stocks will end up with some 35 percent of the newly combined company.
The deal still has to be approved by shareholders, but Japanese technology company Softbank, which owns the majority of Ziff-Davis voting shares, has already endorsed the sale, CNET said.
CNET said the addition ZDNet will give it a dramatic increase in online access to European in Asian markets, which ZDNet said currently account for 10 percent of its revenue. Combined, the companies' online operations will boast what CNET claimed is an audience of 16.6 million users a month. The company will continue to operate under the CNET and ZDNet brands and will offer services in 23 countries
"We're creating a company with global reach and anticipated revenues in excess of half a billion dollars next year," said Dan Rosensweig, president and chief executive officer (CEO) of ZDNet. "Marketers will be able to target the most active buyers through our ... brands, including ZDNet, CNET and mySimon."
Comparison-shopping site mySimon.com was an earlier CNET acquisition.
The companies said Rosensweig will become president of CNET.
Said Shelby Bonnie, CEO of CNET: "Technology is driving the global economy. Our union accelerates our ability to participate in this multi-trillion dollar global market throughout the supply chain."
The companies said that, before the sale, Ziff-Davis would go ahead with the planned spin-off of its trade show and conference business, which includes COMDEX and Seybold Seminars. Current Ziff-Davis (ZD) shareholders are expected to receive a cash dividend of approximately $2.50 per share as a result.
CNET can be found online at: http://www.cnet.com/.
Ziff-Davis is at: http://www.zdnet.com/.
Reported by Newsbytes.com, http://www.newsbytes.com