IAC/InterActiveCorp (NASDAQ: IACI) needs to build up its little Ask.com franchise before it is spun out in a breakup of the parent company. Ask.com is an "also ran" in the search engine fight which includes Google (NASDAQ: GOOG), Microsoft (NASDAQ: MSFT) and Yahoo! (NASDAQ: YHOO).
In an attempt to turn a loser into a contender, IACI is buying Lexico, which owns Dictionary.com, Thesaurus.com and Reference.com. According toThe Wall Street Journal, "Lexico sites drew about 15.6 million unique U.S. visitors in March, according to comScore Inc., compared with 55.4 million for Ask and an array of affiliated sites."
Even if the price of the new addition is low, the Lexico sites are not likely to do much good for the Ask.com franchise. It has already fallen so far behind the three search leaders that it almost certainly cannot catch up. Internet users have already set their preference in this part of the online market. Owning a dictionary site is not going to help that.
IACI's Ask.com can't come from behind and buying additional reference sites is not going to change that.
CBS Corp. (NYSE: CBS) announced Thursday it has signed a deal to buy CNet Networks Inc. (NASDAQ: CNET) for $11.50 a share in cash. CNet operates not only the CNET site, but also ZDNet, GameSpot.com, TV.com, mp3.com and others. The deal values CNet at about $1.8 billion and push CBS to among the 10 most popular Internet companies in the United States. CBS shares are down 2.9% in premarket trading while CNET shares are of course up over 42% to $11.31.
IAC/InterActiveCorp (NASDAQ: IACI)'s Ask.com has bought Lexico Publishing Group LLC, the parent of Dictionary.com, Thesaurus.com and Reference.com among other sites. Earlier this year, Lexico already agreed to be sold to Answers Corp (NASDAQ: ANSW), but the latter couldn't secure the necessary funds. Now, Lexico sold itself to Ask.com, for an undisclosed amount, although the number people are throwing around is $100 million. Could this acquisition help IACI gain -- even a little -- on market leader Google?
United Airlines (NASDAQ: UAUA) and Continental Airlines Inc. (NYSE: CAL), dropping ideas of a merger, are now talking about forming an alliance to still gain some benefits of working together. United appears relentless in its attempts to help its bottom line through a merger or an alliance. While talking to Continental about an alliance, it is still negotiating with US Airways Group (NYSE: LCC).
In a move to help turnaround its troubled business, General Electric Company (NYSE: GE) will sell or divest its appliance division, and could expect to receive between $5B and $8B for the unit, according to the Wall Street Journal. Potential buyers appliance makers BSH Bosch & Siemens Hausger of Germany and Haier Group of China, as well as private equity firms and Controladora Mabe, GE's partner in Mexico.
The Wall Street Journal also reported that Comcast Corporation (NASDAQ: CMCSA) will acquire Plaxo, a networking Web site, in an effort to increase its range of services. Terms of the deal were not disclosed.
To help improve its Ask.com search engine, the Wall Street Journal reported that IAC/InterActiveCorp (NASDAQ: IACI) will buy the Lexico Publishing Group, which owns Dictionary.com, Thesaurus.com and Reference.com.
WEB SITES:
Citing the New England Journal of Medicine, Bloomberg reported that migraine headache medicines, including Merck & Co Inc's (NYSE: MRK) Maxalt and GlaxoSmithKline Plc's (NYSE: GSK) Imitrex caused potentially fatal reactions in at least 11 people. The Journal said people using "triptans," an older class of migraine drugs, could develop serotonin syndrome, which may cause fever, shock, vomiting and rapid heartbeat.
16 Double-Your-Money Stocks It's an investor's dream: A stock with the potential to double in price. How do you spot companies that could potentially rise 100% in price? BusinessWeek asked experts for some advice and their favorite stock picks. Here are 16 stocks that expert investors believe could double in price. They include Rubicon Technology, OM Group, Wonder Auto Technology, IHS, Ansys and Volterra Semiconductor. Stocks: The Double-Your-Money Club - BusinessWeek
8 Ways to Make a Million Don't just dream about striking it rich. Learn from those who did. A growing number of Americans are achieving millionaire status. And in the stories of these ten people you'll find a lot that will make your life richer, whether you become a millionaire or not. See how these entrepreneurs, investors and savers have made a million. Eight Lessons: Ways to Make a Million - Kiplinger.com
Sell in May and Go Away? As Wall Street comes to the end of what is often called the 'best six months' of the year, investors may be feeling cheated. And concerned. If that was the market at its best, what does the market at its worst look like? The past six months was the worst 'best six months' performance for stocks since 1973. And if market indicators hold up, May through October could be a tough period, as per the old Wall Street saw 'sell in May and go away.' But, in an unusual period on Wall Street, the old seasonal standby doesn't apply. But the opposite might. Sell what in May and go away? - CNNmoney Trading Strategies for May MarketWatch offers advice on how to get your portfolio off the ground this month. Trading Strategies - MarketWatch
This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.
The battle between QVC and HSN is really about celebrity entrepreneurs.
QVC counts the likes of Joan Rivers and Marie Osmond in its stable of shills. Suzanne Somers and Susan Lucci hock their wares on HSN, which is owned by Barry Diller's IAC/InterActiveCorp (NASDAQ: IACI) conglomerate.
Somewhere around the 1980s or 1990s, Rivers lost her sense of shame and began opening up about everything, including her numerous plastic surgeries. Rivers still is hysterical. Typical is a recent blog post about Passover in which she joked that people eat Matzo (unleavened bread) "Because, you pig, you inherited your mother's big, fat thighs and you should lay off the carbs for at least one day every year."
Anyway, you just gotta love Rivers. She's survived her husband's suicide, the scorn of Johnny Carson and the ridicule of celebrities on the red carpet. Granted that I won't be buying products such as the Joan Rivers Lilly of the Valley Bee Pin, which according to the QVC website "shines with orange and green epoxy enamel and cream simulated pearls as the buds."
If you thought the news going to be the actual FOMC cut was the key today, it wasn't. The bias and tone for more rate cuts was the most important, and the tone was not hawkish enough. Traders wanted to see a signal of the end of rate cuts, at least for now, so that oil and gold would tank and that the dollar would recover.
GDP came out and showed a +0.6% gain, meaning the official recession isn't technically here yet. Warren Buffett said it is, and he might be good enough of a judge over anyone. Regardless, this is the first positive month for the S&P after it just missed a positive month in March.
Below are the unofficial closing levels for key US index levels:
Buffalo Wild Wings (NASDAQ: BWLD) was upgraded by KeyBanc Capital Markets to Buy and by Cowen & Co. to Outperform. Yesterday, Buffalo Wild Wings reported strong quarter results with a 22% revenue boost and earnings meeting street expectations. Shares were up 18% to $30.74 in the final minutes of the day.
According to the New York Post, IAC/InterActiveCorp. (NASDAQ: IACI) Chairman Barry Diller is expected to meet with his board this week to restart the process of breaking up his company into five separate pieces, sources said. At the same time, Diller and Liberty Media Corporation (NASDAQ: LMDIA) Chairman John Malone are continuing to talk about a deal that would trade one or more of IAC's assets for Liberty's ownership stake in IAC.
The UK Times has learned that Numis Securities, the stockbroking group headed by Michael Spencer, is in "advanced talks" to buy the UK equities business of The Bear Stearns Companies Inc (NYSE: BSC). Numis may look to hire a team of 25 from Bear.
Kirk Kerkorian's Tracinda Corp. is planning to offer $8.50 per share for up to 20 million shares of Ford Motor Co. (NYSE: F), a 13.3% premium over Friday's close. Tracinda now owns 100 million Ford shares, or 4.7% of the outstanding stock, which would increase to 5.6% when the offer is completed. Ford shares climbed over 6.5% in premarket trading. The deal, announced recently, is helping stock futures' upward movement.
Verizon Communications Inc. (NYSE: VZ) reported a 9.8% rise in its first-quarter earnings as its wireless division attracted more customers than other carriers. Excluding items, earnings were 61 cents per shares, inline with estimates. Revenue rose 5.5% to $23.8 billion, also inline with estimates. VZ shares are up 1.9% in premarket trading.
According to The New York Post, Barry Diller and Liberty Media (NASDAQ: LINTA) Chairman John Malone are continuing to talk about "a deal that would trade one or more of IAC Interactive (NASDAQ: IACI)'s assets for Liberty's ownership stake in IAC." Diller is also "expected to meet with his board this week to restart the process of breaking up his company into five separate pieces."
The Wall Street Journal also reported that IAC/InterActiveCorp (NASDAQ: IACI) is planning to launch a number of new web sites, and hopes to capture a variety of audiences including African-Americans, children and news followers.
WEB SITES:
Lehman Brothers Holdings Inc. (NYSE: LEH) said it liquidated three investment funds, with assets valued at $1 billion as of February 29, because of "market disruptions," Bloomberg reported.
Reuters reported that the U.S. Department of Defense approved the sale of 157 armored trucks to Britain. The trucks are built by Force Protection Inc. (NASDAQ: FRPT), and the deal is valued at $125 million if all options are exercised.
8 Comeback Stocks There are legions of beaten-down stocks out there. These companies have disappointed investors for years. But each has a good chance of fixing its problems and bouncing back in 2008. These stocks include Sony, Interpublic Group, Starbucks, Nordstrom, Office Max, UnitedHealth, Qwest and CB Richard Ellis Group. Stocks: Trawling for Turnaround Targets 8 Comeback Candidates
Student Loans Feel the Pinch Credit market constriction is limiting the financial aid available to college students. We have tips for shopping for a private loan. Student Loans Feel the Crunch
6 Ways to Dine Out for Less World appetites for oil and grain have put higher food prices on the menu -- literally. To counterbalance rising costs, restaurants also are offering more promotions to tempt consumers into a night on the town. Savvy consumers can easily trim their bill by 50% or more -- without forgoing the filet mignon in favor of a cheap pasta dish. Try these six tips to spend less. 6 Ways to Dine Out for Less - SmartMoney.com
Cutting Medical Bills Welcome to the brave new world of health care haggling, where patients have become bolder about their medical bills, and doctors more open to negotiation. We went trolling for discounts in the doctor's office to find out just how much work it takes. Under the Knife: Cutting Medical Bills (- SmartMoney.com
How to Get Around Higher Bank Fees Squeezed by the credit crunch, consumer banks are boosting ATM and overdraft fees. Here are some of the biggest fee culprits and tips to avoid them. Banks Boost Fees for ATMs, Overdrafts - SmartMoney.com
Best Graduate Schools 2009 U.S. News has collected data from more than 12,000 graduate programs to bring you this year's rankings. Here is the best for business, science, law, health, fine arts and more. Best Graduate Schools - Education - USNews
Barry Diller has won his dispute with John Malone. Malone's Liberty Media (NASDAQ: LCAPA) owns a a large piece of the company that Diller runs, IAC/Interactive (NASDAQ: IACI). Diller has the right to vote those shares under a long-standing agreement.
Diller has decided to break IACI into five companies because the businesses in the firm do not have significant relationships to one another. Malone wanted to block the break-up and filed suit in court.
According toMarketWatch, "Vice Chancellor Stephen Lamb ruled Friday that "Liberty has failed to demonstrate that Diller has breached or threatened to breach any contractual duty he owes to Liberty," according to Lamb's 78-page opinion."
Diller can now complete his plans.
That leaves open the question of whether IACI is worth more in pieces than it is as a conglomerate. The firm's stock trades at $20, near its 52-week low and down from the period high of over $39. Some of the company's divisions, especially Lending Tree and HSN had tough years in 2007. These would get very low valuations as independent operations and might not make up for the value of more attractive operations like Ask.com
Diller may have gotten his way, but it is not clear that it will help shareholders.
Douglas A. McIntyre is an editor at 247wallst.com.
InterActiveCorp (NASDAQ:IACI) and Liberty Media (NASDAQ:LINTA) have sued each other over IACI's planned breakup into five separate businesses. A Delaware Chancery Court Judge is expected to issue a ruling soon. IACI announced the plan to separate IACI into five publicly traded companies on November 5, 2007:
1) HSN, will include business comprising IACI's retailing segment; 2) Ticketmaster; 3) Interval International, which will include CondoDirect, Resort Quest Hawaii and VacationSource; 4) LendingTree, which will include RealEstate.com Domania, GetSmart, Home Loan Center and iNest; and 5) IAC media & advertising, Ask.com, Bloglines, City Search, Cursor Mania, Evite, Excite, insiderpages, iWon, My Fun cards, Black Web Enterprises Shoebuy.com, Match.com.
IACI April option implied volatility of 47 is above its 26-week average of 38 according to Track Data, suggesting larger risk.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
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