After wooing Angie’s List for the past two years IAC’s wish came true as the two will merge after Angie’s List agreed to the acquisition. When the deal is finally closed, Angie’s List together with HomeAdvisor, the home services marketplace owned by IAC, will form a new public entity known as ANGI Homeservices.
The deal give Angie’s a value of $8.50 per share equal to $500 million. That is a premium cheap windows 10 key of 44.3% over the closing price of the stock as of Monday, but is less than the per share price of $8.75 that IAC offered and was rejected by Angie’s List in November of 2015.
The accepted bid is one of many from IAC whose other businesses include Tinder, but its board believed the per share price of $8.75, which was just a premium of 10% over its stock prices back when it was offered, dramatically undervalued Angie’s List.
However, Angie’s List’s struggles continued despite dropping its fee for membership and moving a year ago to its current freemium model, as part of its strategy for growth set up by Scott Durchslag is new CEO.
Angie’s List was founded by Angie Hicks and William Oesterle in 1995 and is one of the most respected and oldest review sites.
However, it has had problems finding footing against the newest rivals such as Facebook, Amazon Home Services, Thumbtack and Porch and Handy.
The company’s user base growth stagnated and its revenue for quarters over the past two years has been nothing short of lackluster.
Combined, Angie’s List and HomeAdvisor will enjoy a big advantage of scale as it will have 22 million visitors monthly and service providers that top 211,000.
IAC claims that it gives it the title as clear industry leader for the home services industry and says on the basis of pro forma, the new entity made approximately $17 billion in transaction value during the past 12 months for service providers.
Company officials at IAC said the merger was important to the transition to ANGI Homeservices from a platform of recommendation to an on-demand marketplace.
The merger should be closed sometime during the fourth quarter of 2017 said company windowskeys officials. Following that, IAC will have ownership of between 87% and 90% of the equity value of ANGI Homeservices depending upon the number of shareholders that take a cash payout.
Current HomeAdvisor’s CEO Chris Terrill will become the ANGI Homeservices CEO.