IAC/InterActiveCorp to Acquire Ask Jeeves, Inc.
March 21 2005 - 7:41AM
PR Newswire (US)
IAC/InterActiveCorp to Acquire Ask Jeeves, Inc. Combines Leading
Interactive Commerce Brands with Top-Tier Search Engine NEW YORK
and OAKLAND, Calif., March 21 /PRNewswire-FirstCall/ --
IAC/InterActiveCorp (NASDAQ:IACI) and Ask Jeeves, Inc.
(NASDAQ:ASKJ) today announced they have signed an agreement under
which IAC will purchase Ask Jeeves. Under the terms of the
agreement, IAC will issue 1.2668 shares of common stock for each
share of Ask Jeeves common stock in a tax-free transaction valued
at $1.85 billion net of cash acquired. IAC intends to buy back
through its previously authorized share repurchase programs at
least 60% of the number of shares it will issue for this
acquisition, thus effectively offsetting a substantial portion of
the dilution from the transaction with cash. IAC expects the
acquisition to be accretive to 2005 Adjusted EPS assuming the
buyback at the 60% level. Barry Diller, Chairman and CEO of IAC,
said, "Ask Jeeves was founded almost ten years ago based on the
idea that simple text search results alone are not sufficient or
satisfying - but, rather, that consumers want answers to questions
- and questions posed in natural language and answered with spot-on
accuracy were especially desired and appealing. Of the many search
engines launched during that time, Ask was one of the very few that
established itself ... and we believe that in the future it has the
potential to become one of the great brands on the Internet and
beyond, and by beyond we mean in wireless, in the search for
anything on any device. It is that belief, powered by IAC's wealth
of resources and thriving businesses, together with the continuing
strong management of Steve Berkowitz and his team, that is the
impetus for this transaction." The online advertising and search
markets are growing rapidly; of the $260 billion in total U.S.
advertising spend in 2004, less than $10 billion, or 4%, is online,
with an expected annual growth rate of 13%. Search is now 36% of
U.S. online advertising and expected to grow 24% per year over the
next five years (Source: Merrill Lynch Equity Research.) Ask Jeeves
is one of four world-class search technology providers, with
approximately 42 million U.S. unique monthly users,* and is one of
the largest generators of online advertising in the world. IAC
operates more than 40 specialized consumer brands in the travel,
retailing, ticketing, personals, media, financial services, real
estate and teleservices industries. IAC's businesses are leaders in
their respective categories and collectively reach 44 million U.S.
unique users monthly.* IAC enables billions of dollars in
consumer-direct transactions for products and services sourced from
more than 140,000 merchant partners, suppliers, vendors, venues,
lenders, and real estate brokerages. The combined companies will
continue building Ask Jeeves as one of the great brands on the
Internet by: -- continuing Ask Jeeves' growth trajectory by
applying IAC's proven experience in brand management and marketing,
as well as through investment in distribution, R&D, technology
and infrastructure, and international markets. -- leveraging IAC's
leading brands and pioneering new search revenue models by
vertically integrating IAC's transaction brands and offers into the
Ask Jeeves properties. -- making Ask Jeeves the search engine with
the best local search, content and merchant information on the Web
- increasing the distribution of IAC Local merchants and enhancing
Ask Jeeves' local offering. -- promoting the Ask Jeeves search box
on every IAC site, exposing 44 million unique users per month to
the Ask Jeeves brand. "Ask Jeeves is a pioneer in search and has
grown to become one of the leading search providers through
advanced technology and a suite of brands that are differentiated
by both value proposition and delivery," said Steve Berkowitz, CEO
of Ask Jeeves, Inc. "Joining IAC will enable us to play on a much
larger field. We are excited about the opportunity to serve as the
connection between IAC's constellation of leading online properties
to share users and content. Ask Jeeves will now be in an even
stronger position to aggressively grow market share." Ask Jeeves
will remain an independent brand with operations headquartered in
Oakland, Calif. following completion of the acquisition. Steve
Berkowitz will continue as Ask Jeeves' CEO. The transaction is
subject to customary closing conditions, including regulatory
approval and the approval of Ask Jeeves shareholders, and is
expected to close late in the second quarter or early in the third
quarter of 2005, prior to IAC's spin-off of its travel businesses.
Following the spin-off, Ask Jeeves will remain part of IAC.
Wachtell, Lipton, Rosen & Katz acted as legal advisor and JP
Morgan as financial advisor to IAC during this transaction. Gibson
Dunn & Crutcher acted as legal advisor and Allen & Company
and Citigroup Global Markets as financial advisors to Ask Jeeves
during this transaction. * IAC and Ask Jeeves unique user data per
comScore Media Metrix 2005. Conference Call IAC will audiocast a
conference call with investors and analysts discussing the
transaction on Monday, March 21, 2005, at 11:00 a.m. Eastern Time
(ET). The live audiocast is open to the public at
http://www.iac.com/investors.html. About Ask Jeeves, Inc. As the
9th largest global web property (ComScore Media Metrix), Ask Jeeves
Inc. delivers world-class information retrieval products through a
diverse portfolio of Web sites, portals and downloadable
applications. Ask Jeeves' search and search-based portal brands
include: Ask Jeeves (Ask.com and Ask.co.uk), the Ask Jeeves Japan
joint venture (Ask.jp), Ask Jeeves for Kids (AJKids.com), Bloglines
(bloglines.com), Excite (excite.com), iWon (iwon.com), My Way
(myway.com) and Fun Web Products (funwebproducts.com).
Additionally, Ask Jeeves owns the differentiated search technology
Teoma, as well as natural language processing, portal and
ad-serving technologies. Ask Jeeves generates revenue from
advertisers seeking to reach the company's broad-based online
audience. Founded in 1996, Ask Jeeves has been a publicly traded
company on the Nasdaq National Market since July 1999. Its
headquarters are located in Oakland, California, with offices
throughout the United States, as well as in Europe and Asia. For
more information, visit http://www.ask.com/. About
IAC/InterActiveCorp IAC operates leading and diversified businesses
in sectors being transformed by the internet, online and offline...
our mission is to harness the power of interactivity to make daily
life easier and more productive for people all over the world. To
view a full list of the companies of IAC please visit our website
at http://iac.com/. Where to Find Additional Information about the
Acquisition IAC intends to file a registration statement with the
Securities and Exchange Commission ("SEC") that will include a
combined proxy statement/prospectus of Ask Jeeves and IAC and other
relevant documents in connection with the proposed merger. Ask
Jeeves stockholders should read the proxy statement/prospectus and
other relevant materials when they become available, because they
will contain important information about Ask Jeeves, IAC and the
proposed merger. In addition to the documents described above, Ask
Jeeves and IAC file annual, quarterly and current reports, proxy
statements and other information with the SEC. The proxy
statement/prospectus and other relevant materials (when they become
available), and any other documents filed with the SEC by Ask
Jeeves or IAC are available without charge at the SEC's website at
http://www.sec.gov/, or from the companies' websites, at
http://www.ask.com/ and http://www.iac.com/, respectively. Ask
Jeeves, IAC and their respective officers and directors may be
deemed to be participants in the solicitation of proxies from Ask
Jeeves stockholders in connection with the proposed merger. A
description of certain interests of the directors and executive
officers of Ask Jeeves is set forth in Ask Jeeves' proxy statement
for its 2004 annual meeting, which was filed with the SEC on April
16, 2004. A description of certain interests of the directors and
executive officers of IAC is set forth in IAC's proxy statement for
its 2004 annual meeting, which was filed with the SEC on April 29,
2004. Additional information regarding the interests of such
potential participants will be included in the definitive proxy
statement/ prospectus and other relevant documents to be filed with
the SEC in connection with the proposed merger. Where to Find
Additional Information about the IAC Spin-Off In connection with
the proposed spin-off it is currently expected that IAC will file a
proxy statement/prospectus with the Securities and Exchange
Commission (the "SEC"). Stockholders of IAC are urged to read the
proxy statement/prospectus, when it becomes available, because it
will contain important information about IAC, the proposed spin-off
transaction and related matters. Investors and security holders can
obtain free copies of the proxy statement/prospectus when it
becomes available by contacting Investor Relations,
IAC/InterActiveCorp, Carnegie Hall Tower, 152 W. 57th Street, 42nd
Floor, New York, NY 10019 (Telephone: (212) 314-7400). Investors
and security holders can also obtain free copies of the proxy
statement/prospectus and other documents filed by IAC and Expedia
with the SEC in connection with the proposed spin-off transaction
at the SEC's web site at http://www.sec.gov/. In addition to the
proxy statement, IAC files annual, quarterly and current reports,
proxy statements and other information with the SEC, each of which
should be available at the SEC's web site at http://www.sec.gov/.
You may also read and copy any reports, statements and other
information filed by IAC at the SEC public reference room at 450
Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information. IAC and its directors,
executive officers and certain members of management and other
employees may be deemed to be participants in the solicitation of
proxies of IAC's stockholders to approve the proposed spin-off
transaction. Such individuals may have interests in the transaction
as described herein, including as a result of current holdings of
options or shares of IAC's stock and future holdings of options or
shares of Expedia's stock, which will be impacted in the
transaction. Information regarding IAC and the equity interests of
its directors and officers who may be deemed to be participants in
the solicitation of proxies is contained in IAC's proxy statement,
filed with the SEC on April 29, 2004. CONTACTS: For IAC: IAC
Corporate Communications Andrea Riggs 212/314-7280 Deborah Roth
212/314-7254 IAC Investor Relations 212/314-7400 Roger Clark Lauren
Porat For Ask Jeeves: Ask Jeeves Corporate Communications Heather
Staples 510/985-7610 Ask Jeeves Investor Relations Derrick Nueman
510/985-7485 (Logo:
http://www.newscom.com/cgi-bin/prnh/20031105/NYW076LOGO )
http://www.newscom.com/cgi-bin/prnh/20031105/NYW076LOGO
http://photoarchive.ap.org/ DATASOURCE: IAC/InterActiveCorp
CONTACT: For IAC - IAC Corporate Communications, Andrea Riggs,
+1-212-314-7280, or Deborah Roth, +1-212-314-7254, IAC Investor
Relations - Roger Clark or Lauren Porat, +1-212-314-7400; For Ask
Jeeves - Ask Jeeves Corporate Communications, Heather Staples,
+1-510-985-7610, Ask Jeeves Investor Relations - Derrick Nueman,
+1-510-985-7485 Web site: http://www.iac.com/
http://www.iac.com/investors.html http://www.ask.com/
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