Apparently there’s money to be made in the online dating game, and USA Interactive, which already owns Match.com, is continuing to go after it. The e-commerce powerhouse says it plans to spend $150 million for a global online personals group based in Derby, England.
The all-stock deal will see uDate.com Inc., which operates dating and matchmaking services through www.udate.com and www.kiss.com, become a part of Barry Diller’s USA Interactivestable.
The news sent uDate’s stock soaring, up $2.51 to $4.41 at mid-day; at one point it touched $5.40 after opening at $2.35.
USA said it expects the acquisition to be accretive to earnings over the next several years.
For the nine months ended Sept. 30, 2002, uDate reported revenue of $29.2 million, representing growth of 135.6 percent over the same period in 2001. uDate has been in the black for the past five quarters.
The company was founded in 1999 and had approximately 237,000 paying subscribers as of September 2002.
Diller clearly thinks that online dating has lucrative potential, as USA’s Match.com has already emerged as one of the top players in the space. Match.com claims 2.9 million registered users and a paid base of 527,000 users who have forked over fees from $25 for a monthly subscription to $99.95 for 12 months.
During the first quarter of this year, Match.com said it took in $25.2 million in revenue, a 196 percent increase over the $8.5 million it took in during the same time a year ago.
The uDate deal “underscores USA’s commitment to the personals business,” said John Pleasants, president and CEO of Ticketmaster and incoming resident of USA’s Information & Services group.
USA Interactive is comprised of Home Shopping Network; travel site Expedia; Hotels.com; Interval International; TV Travel Group; Ticketmaster, which operates Match.com and Citysearch; Precision Response Corp.; Electronic Commerce Solutions; Styleclick; and Entertainment Publications Inc. upon the close of the USA/Entertainment Publications transaction.