MESG DoubleClick Slashes Purchase Price of E-Mail Marketer
Oct 11, 2001 (NewsFactor.com via COMTEX) -- Online advertising company
DoubleClick (Nasdaq: DLCK) said Thursday it has lowered the price it will pay
for e-mail marketer MessageMedia (Nasdaq: MESG), which it agreed in June to
acquire.
DoubleClick said it will issue 1 million common shares to buy MessageMedia,
rather than the approximately 3 million a DoubleClick spokesperson said were
initially offered. In June, DoubleClick said it would buy the Louisville,
Colorado-based company for stock worth about $41 million.
"Obviously, [MessageMedia's] share price has gone down since then," the
spokesperson said.
In early trading Thursday, Message Media stock fell 14 U.S. cents -- or 53.9
percent -- to 12 cents per share. Message Media had already lost approximately
50 percent of its value in the past three months before DoubleClick's
announcement and 88.6 percent in the past year.
In June, DoubleClick said it would issue 0.0436 shares for each MessageMedia
share. The price was determined by averaging DoubleClick's closing stock price
over a 10-day period.
Broadening Base
DoubleClick also delayed closing the acquisition until the fourth quarter from
the third, and said it will, "under certain conditions," provide MessageMedia
with up to $1.5 million in bridge financing.
DoubleClick says the deal will broaden its client base, as well as provide it
with licensed software of its own. MessageMedia's software delivers more than
100 million e-mails each month for companies including Cisco, E*Trade, Columbia
House and Virgin MegaStores.
Shares of DoubleClick, which is due to report quarterly results after the close
of trading Thursday, were up 58 cents to $7.48 in morning trading.
Ad Drought
DoubleClick and other companies that depend on online advertising have seen
their stock prices fall as clients cut back on spending. DoubleClick itself is
down from a 52-week high of $26.43.
The company has already warned investors not too expect too much from its
third-quarter report. Last month, the company said the September 11th terrorist
attacks hurt sales of both online advertising and software.
DoubleClick said it expects a per-share loss of 9 to 11 cents, down from a
previous estimate of 5 to 7 cents, and revenue of $87 million to $90 million,
rather than the $96 million to $102 million originally projected.
Deals Continue
Still, the company is moving ahead with acquisitions. Earlier this month,
DoubleClick said it bought the technology assets of rival L90 (Nasdaq: LNTY) for
an undisclosed price.
DoubleClick said it bought L90's adMonitor ad-serving and tracking technology,
as well as its ProfiTools marketing platform designed to help clients target
specific Internet users.
Published reports have also said DoubleClick is in talks to buy RealMedia,
another Internet advertising agency. The company had no comment on the reports.
By Nora Macaluso
URL: doubleclick.net
Copyright (C) 2001, NewsFactor Network. All rights reserved
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