Media General surprised Wall Street yesterday with a deal to acquire DealTaker.com, described as an “online social shopping portal that offers consumers a broad array of bargain hunting, posting and comparison opportunities.” The price was not disclosed, but Media General said the acquisition will be slightly accretive to the company’s 2008 earnings. Even so, the deal announcement sent the company’s stock lower for much of the day, although it recovered and was slightly higher by the closing bell.
"This acquisition marks another meaningful step in our acceleration of Media General’s revenue and audience growth by expanding our portfolio of interactive advertising and marketing solutions. DealTaker.com is profitable and has strong margins. DealTaker.com has a performance-based revenue model and quality relationships with brand-loyal users, national retailers and top-level affiliate marketing companies. It will add a platform for community-based commerce to our local sites and will provide non-traditional online revenue for Media General," said Kirk Read, President of Media General’s Interactive Media Division.
DealTaker.com was founded in 2004 and has more than 100,000 registered members as well as relationships with 1,500 affiliated retail businesses. The Web site provides coupons, rebates and bargains, many of them exclusive to DealTaker.com. It currently has more than 400,000 unique visitors per month and offers a number of active community forums where users and moderators share bargain and deal-oriented shopping opportunities in an efficient and trusted environment. In addition, the site offers a proprietary price search engine that compares more than 15 million products.
RBR/TVBR observation: A look at the DealTaker.com site shows couponing and other deals with big name retailers. How all this is going to be integrated with the 75 or so websites that Media General operates for its local TV stations and newspapers is yet to be seen, but company management sees opportunity. Some Wall Street traders obviously would have preferred that the company not go out making acquisitions.