3 Min Read
(Reuters) - IAC/InterActiveCorp (IAC.O) said on Monday it would buy consumer review website operator Angie's List Inc (ANGI.O) in a $500 million deal that bolsters its online home contractor services.
Media mogul Barry Diller's IAC said it would combine Angie's with its digital home services marketplace business, HomeAdvisor, and create a publicly traded company called ANGI Homeservices Inc. This will be the 10th public company to emerge from IAC, Diller said in a statement with Angie's List.
IAC had been looking at buying Angie's list for some time, said HomeAdvisor Chief Executive Officer Chris Terrill. He said talks heated up after Angie's List announced in November 2016 that it was exploring strategic options.
"Once their sales process got started, we started really looking at the opportunities of putting our marketplaces together," Terrill said in an interview.
IAC in November 2015 made an unsolicited bid to buy Angie's for about $512 million in cash, after activist investor TCS Capital Management urged the company to combine with an industry player such as HomeAdvisor. (reut.rs/2pp8gxk)
Terrill, who will lead the publicly traded company based in Golden, Colorado, said one his first goal will be to better monetize Angie's List brand, traffic, loyalty of their customers. The combined company will use both Home Advisor and Angie's List brands.
Investors in Angie's List would get one Class A common share of the new company, or $8.50 in cash for each share held.
The offer represents a premium of 44.3 percent to Angie's Monday close.
Angie's List shares were up 43.3 percent in after-market trading on Monday, while IAC's stock was unchanged.
IAC, which holds a majority stake in Match Group Inc (MTCH.O), owner of Tinder and OKCupid, said the cash portion would be capped at $130 million. The deal is expected to close in the fourth quarter.
Reporting by Aishwarya Venugopal in Bengaluru and Liana B. Baker in San Francisco; Editing by Sriraj Kalluvila