Ybrant Digital to acquire PriceGrabber, ClassesUSA.com & LowerMyBills from Experian for $175M

10 May, 2012

Hyderabad-based Ybrant Digital Ltd, a digital marketing solutions company, has entered into an agreement to acquire PriceGrabber, LowerMyBills and ClassesUSA.com from Experian plc, an information services company which is currently one of the top five Internet advertisers in the US. Ybrant will acquire these three businesses for a total of $175 million (around Rs 938 crore), including $100 million in cash and another $75 million 'loan note'.

The deal will add a business of $283 million (revenues from the three businesses for the year ended March 31, 2012) and will increase Ybrant's employee strength by 300. Steve Krenzer, president of Experian Interactive, will continue to lead the new group by joining Ybrant Digital.

"By adding these established brands to Ybrant, we will offer interesting new products and a world class lead generation platform," said Suresh Reddy, chairman and CEO of Ybrant Digital. The company also claims that the acquisitions will nearly double its current revenues.

While PriceGrabber is a price comparison shopping business which powers Yahoo! and MSN shopping, LowerMyBills.com connects mortgage borrowers to lenders and includes over 500 service providers across multiple categories like home loans, credit cards, auto and health insurance and long-distance & wireless services. ClassesUSA.com is an online higher education portal and the company claims that it has over 2 million visitors and 300 college and university partners.

Experian had acquired these businesses back in 2005 and these have been non-core to the company for several years. According to a company statement, "The agreed divestment is consistent with Experian's strategic focus to extend its global lead in credit information and analytics, digital marketing services and direct-to-consumer services."

Established in 1999, Ybrant provides support services and software tools for online marketing. It offers end-to-end digital marketing solutions to businesses, agencies and online publishers worldwide, using various digital communication tools such as display, e-mail, search, affiliation, co-registration and media marketing. The firm also provides custom software services and solutions ranging from developing & maintaining new applications to implementing third party software. The company has also launched its local search platform Ybrant Reach (YReach) in India.

Ybrant has acquired and integrated a number of global businesses in the last five years, including Lycos (in an all-stock deal in August 2010), Australian Ad Network Max Interactive and Argentina-based ad network Dream Ad (in 2009), Israeli company Oridian (for $13 million) and Serbia-based Seenetix (in 2007), US-based MediosOne (in 2006) and also the ad network AdDynamix (for $10 million). The company also picked up minority stake in Israel-based Web 3.0 in an all-cash deal in June 2011.

Early last year, Ybrant had raised PE investment through a combination of debt and equity when Oak Investment Partners, Asia Pacific Capital, ICICI Bank and a US-based firm invested $48 million in the company.

The company is also looking to merge with the BSE-listed IT outsourcing services provider LGS Global Ltd in a reverse merger deal valued at around $559 million. The all-stock deal has a swap ratio of six shares of LGS for every share of Ybrant and the deal has been recently sanctioned (early last week) by the Andhra Pradesh High Court. Reddy will be the chairman and CEO of the combined entity while Subba Rao Karusula, MD of LGS, will be the business head of the LGS division of Ybrant. Reddy had told Techcircle.in that Ybrant promoters would own around 40-50 per cent of the merged entity, which would be named Ybrant Digital Ltd.

Last month, Reddy had also mentioned that the company was close to acquiring a US-based firm in an all-cash deal. "It is one of the largest content properties in the USA. The transaction has not happened yet although we expect the deal to be closed no later than six months. Post-acquisition, we will be able to offer a larger bouquet of services to our advertisers," he said.