Gusbourne Regulatory News (GUS)

14 Dec 2005 07:01

GUS PLC14 December 2005 14 December 2005 GUS plc Acquisition of PriceGrabber.com GUS plc, the retail and business services group, today announces that Experianhas acquired PriceGrabber.com, a leading provider of online comparison shoppingservices in the US. PriceGrabber.com operates in fast-growing markets andcomplements Experian's existing operations connecting consumers to companiesover the Internet. The purchase price is $485m plus expenses and was funded fromGUS' existing bank facilities. Don Robert, Chief Executive Officer of Experian, commented: "As a trusted and preferred comparison shopping destination, PriceGrabber.comhas a leading position in a fast-growing market. When combined with thecomplementary skills, expertise and scale of Experian, in both Interactive andMarketing, we are very excited about the future growth prospects forPriceGrabber.com." Description of PriceGrabber.comFounded in 1999, PriceGrabber.com is a leading provider of online comparisonshopping services in the US. It is based in California, employs 140 people andhas been privately held. Its website enables consumers instantly to obtain freeand unbiased information before making a purchase decision. Its databasecontains millions of products in over 20 categories such as consumerelectronics, photography, computers, home and garden and apparel. Consumers canthen find the retailer or seller which provides the most attractive offer.PriceGrabber.com connects its online shoppers to over 9,000 merchants of allsizes, from large traditional retailers to smaller local sellers. Thesemerchants pay PriceGrabber.com for each lead (or each consumer directed) to theretailer's own website. PriceGrabber.com also powers comparison shopping on over300 websites, including About.com, Ask Jeeves, Bell South, Comcast and MSN. In November 2005, PriceGrabber.com provided comparison shopping services to over17 million unique visitors. Through continued innovation and consistent focus onproviding the best comparison shopping experience for consumers on the Internet,PriceGrabber.com has established itself as a trusted and effective onlinedestination for Internet shoppers. Its service to consumers offers a wealth ofoptions and information about the products and retailers, with user and expertreviews, generating high customer loyalty. For the 12 months to December 2005, PriceGrabber.com estimates that sales willbe $60m and EBIT $25m, representing an increase of about 50% over the previousyear. Rationale for acquisition The acquisition of PriceGrabber.com further strengthens Experian's position inconnecting consumers to companies over the Internet. In the six months to 30September 2005, Experian Interactive contributed about one-third of sales inExperian North America and grew by nearly 40% excluding acquisitions. Experianbelieves that it can enhance the competitive position of PriceGrabber.com bysharing scale and expertise in Internet marketing, by using Experian's data andanalytics to improve the services offered to consumers and by providing itsretail clients with another channel to sell to consumers. PriceGrabber.com operates in high growth markets. The comparison shoppingservices market in the US was worth about $400m in 2004, with market projectionsfor growth of around 40% per annum over the next five years. This growthreflects increasing use of the Internet by consumers to research and acquiregoods and services, driven in part by greater broadband penetration. The use ofcomparison shopping services by online shoppers is also growing as consumersbenefit from the value these sites deliver. To reach these shoppers, companiesare advertising more online, especially as the return on investment from onlineadvertising is often superior to that from traditional channels. PriceGrabber.com has strong organic growth opportunities. As well as benefitingfrom the natural growth in its established markets, PriceGrabber.com isexpanding its presence in new vertical markets such as auto, travel andwireless. It also has significant international development opportunities asillustrated by its nascent operations in the UK and Canada. PriceGrabber.com complements Experian's Marketing Solutions. Retail andcatalogue shopping is the second largest vertical market for Experian globally.Excluding Experian Interactive, it accounts for about 17% of Experian NorthAmerica sales. The acquisition of PriceGrabber.com will strengthen Experian'spresence in this important sector by giving its retail and catalogue clientsanother channel to market, complementing the current multi-channel offer (directmail, email via CheetahMail and online lead generation via MetaReward). There are further synergies available from combining Experian andPriceGrabber.com, especially as the latter can benefit from Experian'ssubstantial Internet marketing expertise and scale. These include the ability togenerate more traffic at low cost by encouraging consumers to visit otherExperian Interactive websites (Consumer Direct, LowerMyBills.com, MetaReward,ClassesUSA.com and Affiliate Fuel). PriceGrabber.com also expects to be able toimprove the quality of leads referred to retailers' websites by adding Experiandata and analytics where appropriate. Enquiries GUSDon Robert Chief Executive Officer, Experian 020 7495 0070David Tyler Group Finance DirectorFay Dodds Director of Investor Relations FinsburyRupert Younger 020 7251 3801Rollo Head GUS announcements are available on www.gusplc.com. There will be conference calls today at 10am and 3pm UK time to discuss thistransaction. Slides accompanying this call can be either downloaded or viewedlive in conjunction with the conference calls by visiting www.gusplc.com. Arecording of the calls will also be available later in the day on the website. This information is provided by RNS The company news service from the London Stock Exchange EN