InfoUSA Mounts Takeover Bid for Digital Impact

Database marketing powerhouse infoUSA submitted an unsolicited offer to acquire email and digital marketing firm Digital Impact for $70 million. InfoUSA already bought email players @Once and YesMail.

InfoUSA’s $2 per share cash offer represents a 38 percent premium over Thursday’s $1.45 closing price of Digital Impact common shares. Digital Impact shares were up 28 percent at mid-day Friday to $1.86. InfoUSA shares rose by 1 percent to $11.41 on the news.

Digital Impact’s board of directors issued a statement late Thursday saying only that “The Digital Impact board of directors will be reviewing the letter in accordance with their fiduciary obligations.”

If accepted, the acquisition would be the second one for infoUSA this year. The company plans to merge @Once, which it acquired in January, with its YesMail subsidiary, which targets small businesses. It also added Triplex, OneSource, and Edith Roman to its database offerings last year.

“A combination of infoUSA and Digital Impact would create a powerful leader in the fast-growing digital marketing space. I firmly believe that the critical mass that would be created by such a combination is necessary to generate respectable operating margins in a very fragmented industry,” said Vin Gupta, chairman and CEO of infoUSA, in a statement.

Gupta said the combined company would benefit from a unified technology platform, which would create greater operating margins, as well as cross-sell opportunities between its database, data processing, and digital marketing solutions.

Omaha, Neb.-based infoUSA offers direct marketing, telemarketing, customer analysis and credit reference products and services. Digital Impact creates and executes campaigns on its proprietary technology platform across multiple media channels, including email, Web sites, banner ads, search engines, and print direct mail.