FOCUS-MarketWatch.com expands with chart service
SAN FRANCISCO, April 29 (Reuters) - MarketWatch.com Inc.
<MKTW.O> on Thursday said it agreed to buy financial Web site
BigCharts Inc. in a $166 million deal, joining a wave of
publicly traded Internet companies using their high stock
prices to make acquisitions.
The BigCharts deal adds to online news provider
MarketWatch.com's competitive position as a provider of tools
for online investors. BigCharts itself runs one of the top 10
financial sites and also provides content to a number of the
leading online brokers.
"We believe that BigCharts is one of the best in the
business at producing useful, attractive and efficient tools
for investors," said MarketWatch.com president and chief
executive Larry Kramer.
The transaction is valued at approximately $160 million in
stock and $6 million in cash. MarketWatch went public earlier
this year, raising nearly $50 million in cash and watching its
market value soar 450 percent on its first day.
The deal with BigCharts briefly pushed down the value of
MarketWatch's stock by as much as $3.63 on Thursday, as
investors weighed the prospects for earnings dilution. But the
shares closed off just $1.13 at $72.50 on Nasdaq.
"It's a bit of a frothy price to pay but they are getting
one of the premier financial sites, and the have to be
aggressive," said Steve Harmon of the online report
Internet.com.
In recent days, a wave of Internet companies have used
their stock to make acquisitions both to expand their Web site
content build their audience. Amazon.com Inc. <AMZN.O> has gone
on an acquisition binge, taking over auction site Livebid.com,
antiquarian bookseller Bibliofind.com and online music
memorabilia company musicfile.com. Ebay Inc. <EBAY.O>,
meanwhile, acquired the biggest West Coast auction house,
Butterfield and Butterfield.
"Right now everybody's getting consolidation fever," Harmon
said. "It will get even more competitive and values will go
even higher, because there aren't that many good properties out
there."
For MarketWatch (http://www.marketwatch.com), the deal
adds content and traffic, bringing BigCharts' 1 million unique
visitors a month, along with stock charting and portfolio-type
online software that investors use.
"They add value to information through packaging and
interactive tools (to MarketWatch's financial news)," Kramer
said. "By combining these businesses we have the opportunity to
create a dominant company by substantially increasing our
audience reach and pursuing multiple revenue streams."
(Dick Satran, San Francisco office, 415-677-2500)
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