NetRatings Ditches Acquisition and Re-structures

American Internet researchers NetRatings and Jupiter Media Metrix have now decided to pull the plug on the acquisition agreement arranged last autumn. This is believed to follow extensive discussions with the staff at the Federal Trade Commission (FTC) in the USA about the proposed move.

The FTC was set to challenge the loan and security package underlying the possible acquisition agreement. It had previously rejected alternative loan structures as proposed by the companies and had indicated it would seek a preliminary injunction enjoining consummation of the acquisition.

Both Mr. David Toth, chief executive officer of NetRatings, and Mr. Robert Becker, chief executive officer of Jupiter Media Metrix, disagree with the FTC's conclusions. Mr. Becker added that without the benefit of the loan agreement, Jupiter Media Metrix was not in a position to contest the FTC in a lengthy court challenge. The decision to mutually terminate the acquisition agreement does not require either company to pay a break-up fee, and each company will bear its own acquisition-related expenses.

In connection with the announcement of its proposed acquisition of Jupiter Media Metrix, NetRatings also announced that it had agreed to purchase the remaining interests of ACNielsen eRatings.com not currently owned. It is not known whether this transaction will proceed and, if it does, whether or not it will be completed without modification.

NetRatings has also just announced a number of initiatives to streamline its own business and focus on its core product areas. These initiatives include the discontinuation of two products and a reduction in staff, eliminating 20 positions, or about 15 percent of the company's employee base. The products in question are AdSpectrum and eCommercePulse. As a result, the company anticipates annualised cost-savings of between $6 million and $8 million. However, at the same time, it expects to incur a one-time charge of between $6 and $8 million in the first quarter of 2002 to cover the re-organisation and workforce reduction costs.

'We have sharpened our focus on our core audience measurement and analytical research services, with an array of exciting new features planned for the coming months,' said Bill Pulver, president and COO of NetRatings. 'By re-allocating our resources toward these principal products, we maximise the value delivered to our clients and our shareholders.'

'We remain completely committed to our vision of becoming the global standard for Internet media and market research,' concluded Mr. Pulver. 'By listening closely to our clients, we are focused on delivering the key features they value most highly.'

All articles 2006-22 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

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