TMCnet News
infoUSA CEO Proposes to Buy Out Company, Go PrivateBy DAVID R. BUTCHER, Assistant Editor, Customer Interaction Solutions infoUSA Inc., a provider of credit reports and other consumer data, announced yesterday that it has received a buyout offer from Vin Gupta & Company, LLC — an entity controlled by infoUSA’s founder, chairman and CEO, Vin Gupta, who also holds approximately 38 percent of the common shares of infoUSA — to acquire all of the outstanding publicly held common shares of infoUSA not held by Gupta. Upon completion of the proposed transaction, infoUSA will become a privately held company. If the company goes private, it will not be required to make its financial information available to the public, and the stock will not be availably sold to the public; stock will instead be held by members of the company. Under the terms of the proposed offer, Gupta is offering to purchase the remaining 62 percent of the company’s shares from the remaining holders of infoUSA common stock, $11.75 in cash per share, a 25 percent premium to Monday’s closing price of $9.40. Gupta was not immediately available to comment on this announcement, nor was Rick Massey of Stephens Inc., the company’s lead financial advisor. In his letter to infoUSA’s board of directors, Gupta said, “This proposal offers infoUSA’s shareholders the best opportunity to realize a very attractive value for their shares.” In infoUSA’s announcement of the buyout offer, Gupta stated, “This transaction will bring significant value to our stockholders and enables infoUSA to continue to build upon our leading position in the information services industry.” Little has been said regarding how this potential buyout will impact infoUSA’s customers. The closest statement offered came from Gupta and appeared in the company’s announcement of the offer: “Our customers and partners will continue to receive great customer service and value-added products and services from the leading provider of proprietary business and consumer databases, sales leads and business credit reports.” Nearly three months ago, infoUSA made an offer to buy one of its smaller rivals, Digital Impact; infoUSA lost out to larger rival Acxiom’s significantly higher price offer, which may be one factor for which infoUSA is now inclined to go private. It seems that as long as infoUSA shareholders are favorable to the price, chances are this deal will go through. The closing of the transaction, anticipated to occur during the third quarter of 2005, is subject to certain terms and conditions customary for transactions of this type, including finalizing the debt financing, receiving the required approvals and executing the definitive documentation necessary to complete the transaction. ----- David Butcher is Assistant Editor of Customer Interaction Solutions. To see more articles by David Butcher, please visit: http://www.tmcnet.com/tmcnet/columnists/columnist.aspx?id=100008&nm=David%20 R.%20Butcher |