March 7, 2006
NBC Buying iVillage for $600 Million
NEW YORK -- NBC Universal has signed a deal to acquire iVillage, the women's and parenting website, for about $600 million.
The companies said Monday that shares in the publicly-traded iVillage will be purchased for $8.50 a share, up a little more than 50 cents a share from its $7.98 a share close on the Nasdaq on Friday.The deal still has to be approved by shareholders and regulators although it's likely to close in the second quarter.
One of the premiere destinations on the Web for women and parents, iVillage launched in 1995. It reported a full-year 2005 revenue increase of 30% and NBC Universal said Monday that it expected to increase revenues about $200 million in 2006 with a 20% future growth rate.
"It has built a strong name for itself and it's a very advertising-friendly platform," said Bob Wright, NBC Universal chairman/CEO. He said iVillage would be a significant growth platform for NBC Universal's online strategy going forward.
"It gives us immediate scale in the online world," Wright said.
When the deal closes, the New York-based iVillage would report to Beth Comstock, NBC Universal's president of digital media and marketing development.
"Right away you'll expect to see the beauty of both of us (iVillage and NBC Universal), right away we'll be able to bring video to bear and take advantage of the community that iVillage has built up," Comstock said.
Among those video assets include "Today," "Project Runway" and "The Biggest Loser," said Jeff Zucker, CEO of NBC Universal Television.
Zucker wouldn't close the door on using iVillage to help build a women's centered cable channel to compete with Lifetime, WE and Oxygen. He said initial talks had been held about a possible channel.
"I think that's absolutely something we will look at," Zucker said.
There's also the possibility of growing into other areas, beyond the women 18-49 demographic online. Doug McCormick, chairman/CEO of iVillage, said Monday that the company also has gurl.com, a site for teenage girls, and iVillage's parenting sites has built up a following among young fathers too.