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Allrecipes.com sold for $66 million
Seattle Times technology reporter
Seattle recipe-sharing site Allrecipes.com is quoting Food Network host Rachael Ray's trademark line – "How awesome is that?" – after being sold for $66 million to the publisher of Ray's new magazine.
Reader's Digest Association will use Allrecipes.com as an online portal to its food Web sites and magazines, such as Taste of Home and Every Day with Rachael Ray. The site will also sell Reader's Digest cookbooks, and its sales staff will sell online ads for the parent company.
All of the company's approximately 50 employees will be retained in Seattle, where Reader's Digest could expand its online operation in the future, said Allrecipes.com Chief Executive Bill Moore.
"They were more concerned that people might not want to stay, versus the other way around," Moore said. "It's kind of refreshing - they truly want us sitting in Seattle because we're kind of new media and they've been kind of old media."
Allrecipes.com was founded in 1997 after Seattle Web entrepreneur Tim Hunt had trouble finding his favorite cookie recipe on the Internet. The ad-supported recipe sharing and cooking community site began as an offshoot of his company, Emergent Media.
In 1999 Allrecipes.com hired Moore - a former Starbucks executive who created the Frappuccino – to run the business, and it's been profitable for the last two years. It now claims 1.8 million registered members who have submitted and tested 30,000 recipesThrough several rounds of funding that began in 1999, Allrecipes.com raised $11 million from about 60 investors. Employees also received shares and will benefit from the premium that Reader's Digest paid, Moore said.
Reader's Digest, meanwhile, sees Allrecipes.com as key to its online strategy.
"Our acquisition of Allrecipes.com will provide us with a valuable digital platform to further leverage our position as the country's leading food and cooking publisher,'' said Eric Schrier, Reader's Digest president and chief executive, in a release. "It will enable us to bring together online communities from the various RDA properties using the common platform of an industry-leading food and cooking affinity."
Pleasantville, N.Y.-based Reader's Digest expects Allrecipes.com will add about $4 million of sales before interest, taxes, depreciation and amortization. The acquisition's effect on its overall earnings is estimated at neutral to a 1 cent loss per share. negative 1 cent per share to neutral effet on its overall earnings.
Brier Dudley: 206-515-5687 or firstname.lastname@example.org
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