CBS Corp. made a major push into the Internet world on Thursday, announcing that it was acquiring CNET Networks for about $1.8 billion, owner of numerous entertainment and information Web sites.
The deal values CNET at $11.50 per share and is a 45 percent premium over the company's $7.95-per-share closing price on Wednesday. CNET, in a joint press release with CBS, said its board unanimously voted to accept the offer.
CNET owns the technology-oriented news sites CNET and ZDNet as well as GameSpot.com, TV.com, mp3.com, UrbanBaby, CHOW, MySimon and TechRepublic.
The deal is expected to be completed by this years third quarter, boosting CBS's digital properties to 54 million unique monthly users in the United States and about 200 million users worldwide, the companies said. CBS will rank as one of the top 10 Internet companies in the United States following the acquisition.
When you can combine the entertainment assets, the news assets, the platforms that are available with technology, the cross advertising opportunities, it just gives us great scale, CBS Chief Executive Leslie Moonves said on a conference call.
CNET, which reported revenues of $406 million in 2007, already has a considerable presence in overseas markets, especially in China, CBS noted in its statement.
We're thrilled to join CBS and combine our interactive media experience with CBS's world-class content, Neil Ashe, CNET chief executive said. CNET Networks operates some of the most important premium online brands, serving the most sought after online audiences.
CBS shares were down 86 cents to $23.96 in morning trading from its close of $24.82 on the New York Stock Exchange on Wednesday. CNET surged $3.45 to $11.40.