Web publisher eUniverse has swept up e-mail list broker ResponseBase, which it said would expand its paid-site sales while boosting profitability.
Los Angeles-based ResponseBase handles e-mail rentals and campaign distribution, and administers a database totaling about 30 million opt-in names. Clients include eBay , Columbia House and Golfweek.
eUniverse, which also has offices in Los Angeles, said it would pay an undisclosed amount of cash for the company’s assets, and would bring on all 24 of ResponseBase’s employees.
The company said ResponseBase’s database would benefit from being augmented with its own opt-in lists, and additionally, would be used to promote eUniverse’s own paid properties. eUniverse also said it would use ResponseBase’s lists for researching new paid products.
“ResponseBase is a great fit with our existing business,” said eUniverse Chairman and Chief Executive Brad Greenspan. “The transaction will provide us with greater distribution, cross-promotional opportunities and new product ideas, and strengthen both companies’ products and services and advertising business segments. We believe there are significant synergies between the two organizations that should yield immediate benefits and contribute to eUniverse’s long-term growth trend.”
The company added that the purchase of ResponseBase, which is profitable, would be accretive to operations during the current fiscal year. Previously, eUniverse had given guidance of $11.6 million in revenue and $1.8 million in net earnings for the present quarter, its second fiscal quarter of 2003. For the entire year, the company had given revenue guidance of $52 million, with pro forma earnings of $9.9 million.
eUniverse has for some time been exploring ways to boost profitability by acquiring or developing practices that would aid it in promoting its subscription-based sites, such as dating site CupidJunction.com. Last month, it unveiled an internal group intended to work with smaller Web publishers to carry advertisements for eUniverse’s paid sites, in return for a cut of the subscription revenue.
Early this year, the firm attempted to acquire ad network L90 for the same reasons, but ultimately scrapped the deal when L90, now known as MaxWorldwide, came under accounting scrutiny by the Securities and Exchange Commission and Nasdaq.
