InfoSpace sells Switchboard.com in $225 million deal
InfoSpace, which has both Internet and mobile-based businesses, said today that it has sold Switchboard.com for $225 million in cash. The announcement sent the...
Seattle Times technology reporter
InfoSpace, which has both Internet and mobile-based businesses, said today that it has sold Switchboard.com for $225 million in cash.
The announcement sent the Bellevue company's stock soaring, gaining $4.13, or 31.2 percent, to close at $17.38 a share.
InfoSpace sold the property, which provides phone directory services online, to Dallas-based Idearc. The deal is expected to close by the end of the year. InfoSpace said the proceeds from the sale will be paid out to shareholders as a cash dividend.
All 47 employees at InfoSpace who were working on the directory business are expected to join Idearc.
In an interview, InfoSpace's Jim Voelker said the sale exceeded InfoSpace's expectations. InfoSpace purchased Switchboard for about $103 million about three years ago
"We started to think about how much we could monetize the asset for," he said.
He said the market was undervaluing the asset. Last week, he said the company's market capitalization was $425 million. He said the company has about $200 million in cash, leaving the three remaining businesses — mobile, online and directory — worth $225 million, or what it is getting for Switchboard.com alone.
"The market was way off on this," he said.
The company will now focus on its online search business, including Dogpile, and its mobile infrastructure business. However, there has also been speculation whether its mobile business also is for sale.
Voelker declined to comment.
"Clearly I wouldn't comment on any rumors, but I can tell you that we are constantly looking at our businesses here, and continue to look at things to see if our assets are getting an appropriate value," he said.
Tricia Duryee: 206-464-3283 or email@example.com
Copyright © 2007 The Seattle Times Company
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