March 06, 2006
NBC-U to Buy iVillage for $600 Million
Deal-making is in the air and even weekends aren’t off-limits for major corporate announcements, as AT&T-BellSouth proved yesterday. Today, right off the bat NBC Universal taxed the already tired media with another big media-related acquisition (although admittedly not on the scale of yesterday’s big deal): the GE-owned network and entertainment giant is buying iVillage for $600 million.
NBC-U is paying $8.50 in cash per common share of iVillage, the women’s destination site. The deal is slated to close by Q2 06 and is simply one of a string of similar deals by traditional TV companies to forge new distribution channels on the Internet. NBC said in a statement that it expects iVillage, which has posted organic growth of 30% over the past year, to boost its digital revenues to $200 million in 2006.
While NBC plans to leverage the online outlet for expanded delivery of non-video content (Beth Comstock, President, NBC Universal Digital Media and Market Development said that GE even plans to leverage iVillage for GE’s Healthcare division), clearly iVillage will be a key NBC-U outlet for video content.
“This acquisition allows us to marry our on-air branded content with compelling new interactive functionality,” added Jeff Zucker, Chief Executive Officer, NBC Universal Television Group. “From the ‘Today Show’ to ‘Project Runway’ to ‘The Biggest Loser’ to all the health & medical and lifestyles segments we do every day on every one of our owned and operated television stations, we will now be able to create a deeper, richer experience around our content for consumers across all emerging platforms.”
NBC-U appears to be following in the footsteps of News Corp., which last year went on an Internet portal buying spree and indeed is still purchasing online properties.
The two companies will hold a conference call at 10 pm. More later.
Posted by Cynthia Brumfield at March 6, 2006 08:13 AM