the owner of Ticketmaster, Expedia, Hotels.com and Match.com, will now fold online financial services into its ever-growing portfolio with the acquisition of LendingTree,
an online lending company which recently added real estate to its mortage and loan services, for $734 million.
Barry Diller, Chairman and CEO of USA Interactive said his company’s
services and customer base of 40 million would make for profitable
synergies with LendingTree. Sounding like an ecommerce enthusiast from
three years ago, Diller said “we are at the beginning of a new era with
interactive properties that relate to each other. We think there is a
natural law here and within a year these will become quite significant.”
LendingTree sees the deal as an opportunity to capitalize on its brand.
“We have reached a point where our brand is almost bigger than our
business,” said Doug Lebda, Founder and CEO of LendingTree. “That’s when you
look to a company like USAI.”
Both parties began discussing a merger about six months ago. Under the
proposed stock for stock transaction, LendingTree shareholders will get
0.6199 shares of USAI common stock for each share of LendingTree common
stock. The action must be approved by LendingTree shareholders. Completion
is expected this summer.
It is yet another change for USAI, which until May of last year was USA
Networks. Since then, however, it has sold off its entertainment business to a joint venture with Vivendi Universal.
Founded in 1996, the LendingTree exchange consists of more than 200
banks, lenders, and brokers. The company has done close to $48 million in
loans to date. The realty service connects consumers to a network of
approximately 9,000 realtors.
Diller promised that LendingTree would remain intact. “We do not intend
to change the LendingTree culture,” he said. Lebda and Tom Reddin,
LendingTree’s President and COO, will keep their jobs, and so will other
senior LendingTree staff members.