About ten years ago, Bankrate (NASDAQ: RATE) became a public company, as the IPO market was in full-steam (a traditional financial information provider, the company went to the Web in the mid 1990s). Well, now the company has decided to go private.
The private equity sponsor, Apax Partners LLP, has agreed to buy Bankrate for about $571 million. The share price comes to $28.50.
The deal has some interesting twists. First, it's one of the largest transactions of 2009. Next, there is no debt in the deal.
No doubt, the private-equity playbook has changed significantly over the past few years. However, it is encouraging that there is some more interest in dealmaking.
At the same time, Apax realizes that there are nice opportunities to snag. While Bankrate has a strong online platform, the fact remains that the company is experiencing some temporary weaknesses. Yesterday, the company announced preliminary results of Q2 revenues of $31 million (down from $40.2 million a year ago) and net income of $1.9 million (down from $4.1million).
However, Bankrate should be a big beneficiary of the move of advertising dollars to the online world. And, Apax is willing to take the long-view on the investment.
Tom Taulli is the author of various books, including The Complete M&A Handbook, You can reach him at his personal blog.
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