ValueClick has signed an agreement to acquire MeziMedia, an operator of comparison shopping Web sites, in a deal that should augment ValueClick’s search optimization and marketing abilities.
ValueClick said it will initially pay about $100 million for all outstanding equity interests in MeziMedia. The MeziMedia management team will remain in place and additional payments from ValueClick, up to $352 million, will be made based on whether various performance benchmarks are attained by MeziMedia after the acquisition, said ValueClick VP of Investor Relations Gary Fuges.
ValueClick said the privately held MeziMedia is the nation’s fourth-largest comparison shopping company. Its Smarter.com comparison shopping and CouponMountain.com coupons sites attracted about 10.5 million unique U.S. visitors according to a June comScore report, said ValueClick. The company generated approximately $40 million in 2006 revenue.
ValueClick believes the acquisition of MeziMedia will expand its growing comparison shopping segment to the point where it will become a leader in the U.S. comparison shopping market, a market that is, said one ValueClick executive, a form of search marketing.
“Generally speaking, we focus on providing very technology-reliant services, online marketing and ad services, that help advertisers generate sales or customer leads online,” said Fuges. “Comparison shopping is one of the components of our offering.”
Since the advertisers pay comparison shopping sites money for clicks, “comparison shopping is really commerce-based search,” said Fuges. “You’re searching for information on a product or category of product. You identify yourself as being in the market. It’s a very performance-oriented online advertising tech, one we think is very powerful.”
ValueClick’s main comparison shopping presence, through Pricerunner.com, is in Europe. “Acquiring Mezi gives us immediate scale in the U.S. as it pertains to comparison shopping,” said Fuges.
He said MeziMedia, whose executives include several veterans of Overture and Shopzilla, are “very well versed and experienced in using search” and they’re taking the “broad-based reach of search engines, either in natural search in SEO or the paid listing results of SEM, and using that channel to generate traffic for their own sites,” said Fuges.
He said MeziMedia has its own technology platform and “a lot of expertise” that ValueClick believes will help expand the existing ValueClick comparison shopping offerings and also help the company improve its use of search in its other businesses. Also, MeziMedia will give ValueClick a formal presence in China where most of MeziMedia’s employees are situated.
In a statement, MeziMedia co-founders Talmadge O’Neill and Harry Tsao said they are proud of their “significant accomplishments in comparison shopping, SEO and SEM” and think the time is right for the ValueClick deal, expected to close in August.
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