June is a lucky month if you are a shopping search engine. Last week, eBay.com agreed to acquire Shopping.com for $620 million, and on Monday, the E. W. Scripps Company announced its plans to acquire Shopzilla for $525 plus Shopzilla's net working capital at the time of closing, which is expected to be about $35 million.
Shopzilla and Shopping.com are comparison-shopping sites where consumers can enter products and find listings from merchants from websites across the Internet. Both services generate revenue by collecting a fee when a consumer is directed to a retailer's online store. But the acquiring companies are both very different. eBay is a global ecommerce marketplace, and Scripps is a content company with newspapers, television networks, television stations and the Shop at Home home-shopping TV subsidiary.
Scripps said its combined sites are one of the top-50 drivers of Web traffic. Scripps national television network websites include FoodNetwork.com, HGTV.com, DIYNetwork.com, fineliving.com, gactv.com and ShopatHomeTV.com. Scripps Internet brands also include United Media's Comics.com and websites operated by the company's local newspapers and broadcast television stations. According to the press announcement, Scripps plans to use its growing portfolio of national, local and interactive businesses, along with its experience in brand management and marketing, to help Shopzilla accelerate its growth.
Shopzilla attracted 14 million unique visitors during April. The service aggregates and organizes information on more than 30 million products from 55,000 retailers, worldwide. Shopzilla also operates BizRate, a consumer feedback network with about 1 million fresh consumer reviews of stores and products added each month.
Shopzilla is a privately held company that is expected to generate $30 million to $33 million in segment profit on revenue of $130 million to $140 million for the full year 2005. Shopzilla also powers shopping search for many of the Web's largest consumer sites including AOL, Lycos, Time Warner's RoadRunner and many others.
The transaction, pending regulatory and other approvals, is expected to be completed early in the third quarter of this year. Shopzilla will become a stand-alone operating unit of Scripps. Its financial results will be reported as a separate division of the company.
"Shopzilla is a significant Internet play for Scripps," said Kenneth W. Lowe, president and chief executive officer for Scripps. "In many ways, like our other media businesses, Shopzilla is a content company. By organizing shopping information so that consumers can buy almost any product from a wide variety of merchants, the Shopzilla team has taken commerce and content and melded the two together to produce an extremely compelling value proposition to consumers and merchants alike. As more consumers become aware of this service, we're betting that Shopzilla will become the way that people shop online."
"Online shopping already is a $100 billion-plus industry in the U.S. alone, and it's still the early innings," said Mohit. "With Scripps and its lifestyle brands, media assets and financial resources backing our team and vision for building the ultimate shopping service, we are assured of the chance to continue building Shopzilla into a site that consumers worldwide will choose every time they want to shop online."
http://www.shopzilla.com
http://www.scripps.com
