UK online business information group MAID Plc has confirmed it is in discussions with $3bn US communications company Knight-Ridder Inc with a view to buying the US firm’s online information business. MAID chairman Michael Mander says if the deal goes ahead, it will be of enormous mutual benefit, and the companies are viewing it more as a partnership than an acquisition. Mountain View, California-based Knight Ridder Information Inc’s Dialog and DataStar scientific and technical databases are the key services MAID’s interested in acquiring, which it would put together with its Profound business database and Infosort search engine. Listed on both the London and Nasdaq exchanges, MAID has made no secret of its ambitions in the US, and now claims more than 50% of its revenue comes from there. However, Mander says Dialog in particular has a huge database and is enormously respected in the US, and will obviously help further the company’s ambitions on that side of the Atlantic. In due course, Mander says, MAID, Dialog and DataStar users will all have access to three major databases. MAID’s official statement says the acquisition will go ahead only if it would be earnings enhancing in the first year, but Mander suggests it is likely to happen, and in weeks rather than months. The Knight-Ridder unit has some 650 online databases, 1,044 employees and claims 20,000 customers. Reed Elsevier’s Lexis/Nexis is the market-leading competitor to both MAID and Knight-Ridder Information. Dialog began life as a Lockheed Missiles & Space Co research project in the early 1960s and was later applied to the NASA database. It was launched as a product in 1972 with two databases and bought by Knight-Ridder in 1988, which acquired DataStar in 1993. The unit did $289.8m revenue in 1996 – up 4.3% on 1995. In the six months to June, MAID’s generated a profit of $1.33m on revenue of $22.4m calculated at $1.60 to the UK pound. MAID’s market capitalization is around $351.5m. It ended the second quarter with $9.6m cash but last week paid out $9m of that to buy Cambridge, UK information retrieval company Muscat. MAID will fund its bid mostly with debt, partly by equity.
Content from our partners
