MAID Plc, the London based supplier of on-line information services, has finally confirmed the deal which will catapult it from being a fringe player with a 3% market share, into the world’s biggest electronic information company with an estimated 25% of the global market. MAID is to pay $420m in cash for Knight-Ridder Information Inc (KRI) and Knight-Ridder Information AG, both subsidiaries of the US based newspaper and publishing giant, Knight-Ridder Inc. The reverse take-over by MAID, first mooted in August (CI No 3,231), is such a huge step that the firm has had to ask for its shares to be temporarily suspended from trading in London and on the Nasdaq while the transaction is completed. In 1996 MAID turned over $34.6m while its target had revenues of $289.8m. Following completion, scheduled for November, the merged companies will be newly christened and re- launched as The Dialog Corporation Plc. In revenue terms, it will be number one in Europe and Asia and number two in the US behind Lexis-Nexis. The $460m cash required to complete the deal will be raised through a $190m placement of new equity together with $270m in senior and subordinated debt. KRI’s earnings have been declining since 1994 and the company has only broken even in the first half of 1997, but MAID insists this is due to poor acquisition policies which will be re-structured. KRI is cash generative and MAID predicts enhanced earnings as early as 1998, born from synergistic savings of $35m annually. But the company would neither confirm nor deny the need for lay-offs to achieve these cost cuts. MAID says it sees the deal as a coming together of its cutting edge technology and user focused data base access methods with one of the worlds biggest established collections of high value content.
