R.H. Donnelley Acquires Business.com for $345M

Local business directory publisher buys company, edging out other suitors including News Corp.

Business.com, a web advertising and directory business, has sold for $345M in cash and “deferred purchase consideration” to R.H. Donnelley (NYSE: RHD). R.H. Donnelley is a yellow pages and local search company. The Business.com acquisition is a way for the company to diversify.

As I pointed out earlier, this is not just a transaction for the domain name Business.com. Many bloggers and media will portray it as such. But the acquisition is for a company that will gross about $50M this year and earn about $15M profit. It includes the domain names Business.com and Work.com, which are certainly a foundation for the business, but it includes a lot more. The business has 100 employees and over 6,000 advertisers to which R.H. Donnelley can cross sell its other services.

The business.com domain name helped ignite the domain name business. Businessman Marc Ostrofsky, who is also a co-founder of iREIT, purchased the domain name for $150,000. He later flipped the domain for what turned out to be $2.0M.

R.H. Donnelley Corporation will discuss this transaction and 2nd quarter earnings on a conference call scheduled for today at 10:00 a.m. ET. Individuals within the United States can access the call by dialing 888-387-9606. The pass code for the call is “RHD.”

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