Interactive Data to Acquire Lycos Inc.'s Quote.com
Transaction Will Broaden eSignal's Portfolio of Streaming, Real-Time
Market Data Platforms for Active Traders and Create a Comprehensive Online
BEDFORD, Mass., February 1, 2006 - Interactive Data Corporation (NYSE:
IDC), a leading global provider of financial market data and analytic tools to
institutional investors, active traders and individual investors, today
announced a definitive agreement to acquire Quote.com® and related assets
from Lycos®, Inc. for $30.0 million in cash. The acquisition is expected
to close during the first quarter, subject to customary closing conditions
including governmental approvals.
Quote.com, also known as the Lycos Finance division, markets four distinct
offerings that deliver financial content and trading tools to active
traders and individual investors. These include the subscription-based QChartsT and LiveChartsT services that provide real-time streaming data and decision support tools to help active traders formulate investment strategies, as well as Quote.com, a financial news and analysis website, and Raging
BullT, an online investment community and message board site. Upon completion of the transaction, the assets of Quote.com will be operated as part of Interactive Data's eSignal division.
"The acquisition of Quote.com represents an important step in expanding
eSignal's capabilities, content and services," said Stuart Clark, president
and chief executive officer of Interactive Data Corporation. "With the
addition of the Quote.com assets, eSignal will deliver a broader suite of
services to an even wider range of active trader customers and possess an
increasingly valuable family of financial portals. We believe that the
combination of our acquisition of the Quote.com assets, our December 2005
acquisition of IS.Teledata AG, and the product development initiatives now
in place across our organization positions us to accelerate our revenue
growth in 2006 and enhance our profitability in 2007."
The addition of LiveCharts and QCharts will complement and augment
eSignal's existing portfolio of streaming, real-time market data platforms and
analytical tools, and bring more than 14,500 direct subscribers to
eSignal. As of September 30, 2005, eSignal reported approximately 46,000 direct subscription terminals. The combined set of websites, which will include eSignal's recently launched MarketCenter.com and FutureSource.com, as well as Quote.com and RagingBull.com, generate an aggregate of 196 million page views per month. Interactive Data anticipates this will position eSignal to build a growing new revenue stream through online advertising.
"Quote.com has become an industry leader in providing premium
subscription-based charting and analysis tools, and considered to be one
of the leading brands of the Lycos Network," said Alfred Tolle, chief
executive officer, Lycos, Inc. "Over the past year, however, Lycos has evolved our business to focus on digital content creation, as a destination for people
to create, store and market content. Going forward, it became evident that
Quote.com did not fit in with this strategy and we began looking at a
better fit for Quote.com. We believe that Quote.com will enhance and complement Interactive Data's eSignal portfolio of offerings, and that this
transaction will help ensure that Quote.com's customers continue to receive a high level of service."
"This acquisition will help eSignal achieve its goal of becoming the most
comprehensive, flexible and easy-to-use financial information resource for
active traders," said Chuck Thompson, president of Interactive Data's
eSignal division. "The addition of the LiveCharts and QCharts services
will further expand eSignal's portfolio of services and tools, thereby enabling
us to better address the unique needs and skill levels of both novice and
more experienced traders who are seeking lower priced alternatives. At the
same time, by uniting the financial websites from Quote.com and eSignal,
we can create a compelling online destination for the millions of people who
rely on the Internet for global financial markets information and the
advertisers that target this audience. By taking advantage of our existing
infrastructure and resources, we believe that we can cost-effectively and
rapidly enhance the content and capabilities of these acquired services
Quote.com currently employs approximately 30 people. The majority of these
people are based in Waltham, Massachusetts, with the remainder in Santa
Clara, California. David Kim, Quote.com's general manager, will continue
to oversee the Quote.com assets, reporting directly to Chuck Thompson,
president of eSignal.
The Quote.com assets generated, on an unaudited basis, 2005 service
revenue of approximately $12.7 million with total costs and expenses, excluding amortization, of approximately $9.5 million. Assuming the transaction closes during the first quarter of 2006, Interactive Data anticipates that the transaction will be earnings neutral in 2006, and through a combination of planned revenue growth and operational synergies, accretive to earnings in 2007 and beyond.