E-mail marketer NetCreations Wednesday said that it is gearing up to go forward with a planned merger with an Italian Internet firm, making peace with former suitor DoubleClick and laying groundwork for a shareholder vote.
Spokespeople from NetCreations said it has paid its dues — to the tune of $8.6 million in cash — to DoubleClick after their failed merger, as part of an existing agreement between the two companies. That fee ultimately will include $850,000 to $900,000 in expenses, as stipulated in the merger agreement. Typically, those costs cover printing and consultation fees.
NetCreations also said it plans to reschedule its annual shareholder meeting. The New York-based company’s annual shareholder meeting, scheduled for Dec. 28, 2000, was to be used to vote on a merger with Alley advertising giant DoubleClick, which announced its intention to purchase NetCreations in a cash-and-stock deal valued then at $191 million.
But that was until last week, when an unnamed firm made a cash offer topping DoubleClick’s bid — which had lost much of its leveraging power due to market contractions.
That mystery suitor was unveiled Tuesday morning as Italian portal and phone directory publisher SEAT Pagine Gialle, which aimed to broaden its recent efforts to move into international marketing services.
Under SPG’s offer, each outstanding share of NetCreations common stock would be converted into the right to receive $7.00 in cash. DoubleClick had offered 0.41 shares of DCLK stock for every share of NetCreations. At the time, that represented about $12.15 per share, well over NTCR’s price at the time. But after several tough months for the New York ad serving and technology firm’s stock price, the value of 0.41 of a share of DoubleClick dropped to $3.76, while NTCR was trading at $6.65.
Now, NetCreations will postpone its shareholder meeting to give it time to prepare, file and distribute proxy voting materials to shareholders to approve the new merger offer by SPG.
Barring another outside bid, NetCreations anticipates the deal going through without a hitch. The company’s two largest shareholders are its co-founders, chairman and chief executive officer Rosalind Resnick and board member Ryan Druckenmiller. Together, the two control about 65 percent of NTCR’s outstanding common stock, and have pledged to approve the merger, which requires a two-thirds (or 66.6 percent) approval margin.
NetCreations did not announce a date for the shareholder meeting, but reiterated that it expects to close the merger by first quarter, 2001.
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