FindWhat Closes Espotting Buy, Gets New President

  |  July 1, 2004   |  Comments

The paid search listings player consummates its on-again, off-again deal with European paid listings provider Espotting and gets itself a new president to boot.

Paid search listings player FindWhat.com Thursday completed its merger with European paid listings provider Espotting Media and promoted its COO to president.

Espotting stockholders received 7.0 million shares of FindWhat.com common stock and approximately $11.5 million in cash. FindWhat is also issuing options to buy about 700,000 shares of FindWhat.com stock, at a weighted average exercise price of $4.71, in exchange for options and warrants held by Espotting employees and affiliates.

"The deal officially closed first thing this morning," said Karen Yagnesak, marketing director for FindWhat Thursday. "It's the dotting of the 'i's,' the crossing of the 't's' and many hurrahs."

The approximately $170 million cash and stock deal creates a company spanning three continents, with relationships with more than 100,000 online businesses.

The deal was first announced in June 2003. After a shaky period in which the deal seemed to be off, the merger date was extended in late December. An amended agreement was announced in February and the deal officially closed in late June.

Yagnesak confirmed that the companies would continue to operate separately, with Espotting keeping its name and executive officers. "Our strategy is to think globally but act locally. To have resident experts in each country benefits not only us but the advertisers and the searchers," Yagnesak said.

In addition to the consummation of the Espotting merger, FindWhat also announced that Phillip Thune, the company's COO since 2000, has been promoted to the position of president and COO. Thune had also served as CFO from April 2000 through June 2004.

Thune's replacement in that position will be Brenda Agius, whose promotion was announced at the same time as Thune's. Agius had been the company's SVP finance since February 2004, and its VP finance from April 2002 to February 2004.

The company also affirmed its guidance for the second quarter of 2004, saying it expects to be in line with or slightly ahead of April 26 projected revenue of $27 million and adjusted pre-tax income of 27 cents a share. The company forecast third-quarter revenue of $55 million to $60 million and 2004 revenue of $167 million to $179 million.

Unlike Overture and Google, which compete over the top portals, FindWhat has focused on second- and third-tier distribution sites including CNET's Search.com, Excite and Dogpile. FindWhat has about a billion searches per month, compared to about two and a half billion queries a month racked up by fellow second tier player Kanoodle.com. FindWhat's new acquisition Espotting also boasts about a billion searches a month, according to Yagnesak.

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