About.com Acquires Direct Marketer
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About.com, best known for its network of vertical content sites, added direct marketing to its lines of business this week, acquiring direct e-mail marketer Sombasa Media in an all-stock deal valued at $35 million.
The deal calls for About.com (BOUT) to pay 400,000 shares of unregistered stock, which closed at 88 7/16 on Monday.
The purchase of Sombasa Media gives About.com a new product line -- opt-in e-mail newsletters that inform subscribers about sales and special offers at e-commerce sites. The first is BargainDog, which offers information about sales at a variety of sites and boasts 500,000 subscribers. A second, called StyleSpeak and focusing on full-price fashion and beauty sites, will soon be launched.
"It was a clear missing piece in the platform," said Scott Kurnit, chairman and chief executive officer of About.com.
With its latest acquisition, About.com also acquires the technology behind those e-mail newsletters. It's a personalization engine that allows users to select subjects they're interested in, and sends them e-mails consisting of content filtered for their preferences.
About.com plans to use this technology across its existing 700 newsletters, and, perhaps, allow users to build their own newsletters with a personalized mix of content.
"There isn't anything that an engine like this doesn't do well," said Kurnit.
Conversely, the company will leverage About.com's ad inventory to boost the subscriber list of its new acquisition.
Sombasa Media is headquartered in Boston, and About.com plans to combine its offices with its own Boston presence.