Updated: Financial Media Company The Deal Acquired by TheStreet, Inc.
TheStreet attempts to expand subs by outbidding multiple strategic buyers.
Financial media enterprise The Deal LLC has been acquired by¬†TheStreet, Inc.
Terms of the acquisition were not announced in the¬†release, but multiple reports say the sale was worth $5.8 million.
Update: In a seperate call, TheStreet CEO Elizabeth DeMarse confirms the sale was for $5.8 million.
"This is a terrific combination that grows the most profitable portion of our business, subscription revenues," DeMarse says. ¬†"The Deal is a prominent and well-respected brand that the market will intuitively associate with TheStreet, creating new revenue opportunities for both businesses at minimal incremental cost."
Specifically, DeMarse says, much of the acquisition was driven by the direct sales force wielded by industry news and analysis service The Deal Pipeline.
"We have products that would benefit greatly from a direct sales channel," she emphasizes, referring to TheStreet's newsroom content and real-time industry Chat-on-the-Street product.
DeMarse also confirms that "a majority" of The Deal's staff and management, including The Deal's current president Kevin Worth, will be retained. She estimated the actual figure would be between 50 and 75 percent.¬†¬†
The Deal, publishers of¬†TheDeal.com¬†and¬†The Deal magazine, in addition to The Deal Pipeline, had been in discussions with multiple strategic buyers over the past five months, according to Reed Phillips of¬†DeSilva+Phillips¬†who brokered the sale.
‚ÄúThere was a belief that there were a fair number of strategic buyers who would be interested in this business,‚ÄĚ he says.
Phillips confirmed that Bloomberg had been one of the interested buyers, in addition to TheStreet. The Wall Street Journal¬†reported¬†that Dow Jones & Co. had also been considering the purchase, while PEHub.com¬†listed¬†The New York Times and The Financial Times as potential buyers, as well.
TheStreet says it will use both the content-creation and marketing resources of The Deal in its new capacity.
‚ÄúThis is a terrific combination that grows the most profitable portion of our business, subscription revenues,‚ÄĚ says Elisabeth DeMarse, CEO of TheStreet, in the release. ‚ÄúThe Deal is a prominent and well-respected brand that the market will intuitively associate with TheStreet, creating new revenue opportunities for both businesses at minimal incremental cost.‚ÄĚ¬†
The Deal, founded in 1999, was purchased by private-equity firm Wasserstein & Co. in 2000. The company¬†secured $30 million¬†in a round of private financing later that year.
Update: DeMarse lists The Deal's trailing twelve month revenues at $10.1 million.¬†
Several sources confirmed The Deal had been interested in a sale several years ago, but failed to find a suitable bid.