Updated 06:47 PM EST, Mar-2-2001
J&J buys eToys' BabyCenter.com
by Ivan Castano
Posted 04:05 PM EST, Mar-2-2001
Healthcare goods maker Johnson & Johnson Inc. March 2 bought BabyCenter.com Inc., a family of parenting-related Web sites, from bankrupt eToys.com for $10 million in cash.
The BabyCenter store, based in San Francisco, was not acquired and will be temporarily closed, but a J&J spokesman said the New Brunswick, N.J.-based company could purchase it from eToys.
"We don't want to speculate about this now, but we do plan on reopening the store in the near term," Jeffrey J. Leebaw said.
EToys, whose market capitalization once topped $1.5 billion, announced Feb. 26 that it was filing for Chapter 11 bankruptcy protection and that it was closing its Web site in early March.
EToys officials could not be reached for comment March 2.
The BabyCenter group of Web sites, including ParentCenter.com and BabyCentre.co.uk, will continue to function independently, Leebaw said. The group also offers health and parenting articles, weekly e-mail newsletters and chat rooms.
BabyCenter, bought by eToys in July 1999, has two million visitors per month. It will operate as a unit of Johnson & Johnson Consumer Companies Inc. That division typically invests in child-related consumer products, including those related to skin, womb and oral care, Leebaw added.
Christian Koffmann, chairman of J&J's consumer and personal-care group unit, said: "Johnson & Johnson was attracted to the superior content and personalized relationship that BabyCenter, as the leading online parenting brand, has created with millions of parents from conception through childhood."
Hurt by Nasdaq's meltdown last spring, eToys blamed its current predicament on heavy debt, which stood at $274 million as of Jan. 31, as well as a lack of funding.
Except for the BabyCenter retail operation, J&J won't bid for any more eToys properties, Leebaw said.
Broken eToys
After ceasing operations, eToys is selling off its Babycenter unit to Johnson & Johnson.
Company: eToys
CEO: Toby Lenk
Headquarters: Los Angeles
Market cap: $24.8 million
Founded: November 1996
Sales: $151 million for fiscal year ended March 31, 2000
Date
Action
10/01/97 eToys launches its Web site.
3/18/98 eToys acquires Toys.com from Web Magic Inc.
4/19/99 eToys announces plans to merge with BabyCenter Inc., an information and commerce Web site.
5/20/99
eToys IPO prices at $20, stock debuts at $78 on the Nasdaq.
7/01/99 eToys completes acquisition of BabyCenter Inc.
12/01/99
Company announces $150 million private placement of convertible debt.
10/20/99 The company launches international site, etoys.co.uk.
3/13/00 eToys launches BabyCenter brand in U.K. as babycentre.co.uk.
6/13/00 eToys completes $100 million private placement.
12/18/00 Company's stock drops 75 cents per share to new low of $0.28.
12/18/00 eToys' third-quarter sales total only half of company's estimate.
1/02/01 Company's stock closes at $0.22.
1/03/01 eToys closes European unit.
1/04/01 Company lays off 70% of staff.
1/19/01 eToys hopes of selling itself fade.
1/22/01 Analysts rate eToys chances as slim.
2/06/01 eToys finally lays off remaining staff and closes operations.
Sources: The Deal
thedeal.com |
