NEW YORK and WALTHAM, Mass., Dec.
20, 2019 /PRNewswire/ -- IAC (NASDAQ: IAC) and Care.com
(NYSE: CRCM), the world's largest online marketplace for finding
and managing family care, announced today that the two companies
have entered into a definitive agreement pursuant to which IAC will
acquire Care.com for $15.00 per share
in an all-cash transaction representing approximately $500 million of enterprise value. This
valuation represents a 34% premium to Care.com's unaffected closing
stock price on October 25, 2019, the
last trading day before a media report was published speculating
about a potential sale process.
With more than 1.5 million successful matches made since its
inception and 374,000 paying families as of Q3 2019 , Care.com is
the leading global platform for matching families with caregivers
in the rapidly growing but highly fragmented market for family
care, sized in excess of $300 billion
in the US alone. With this acquisition, IAC will gain a foothold in
a market new to the company with natural, secular tailwinds.
Following a proven playbook used to grow other marketplaces, IAC
will invest to accelerate Care.com's growth across its core
categories (child and senior care) with the opportunity to further
extend its platform into adjacent areas, such as pet and home
care.
"Family care is exciting new territory for us—and an
accelerating market as demand for both child and senior care
intensifies worldwide," said Joey
Levin, CEO, IAC. "The Care.com team has built a trusted
brand and marketplace for families all over the world. We like
marketplace businesses and this is one in a category we think has
incredible potential."
As part of the agreement, IAC and Care.com also announced plans
to appoint long-time IAC executive Tim
Allen to Chief Executive Officer of Care.com, effective upon
closing. Mr. Allen succeeds Founder, Chairwoman and CEO,
Sheila Lirio Marcelo, who announced
plans to transition from the CEO position earlier this
year.
"I'm both thrilled and honored at the opportunity to lead
Care.com at this very pivotal moment for the company," said Mr.
Allen. "Care.com is the go-to brand making it easier for millions
of families to connect with affordable, accessible care – I'm
excited to start its next chapter as an IAC company."
Ms. Marcelo said, "Since our founding 13 years ago, we've
delivered on our mission to help millions of people find
affordable, high-quality care and caregivers find meaningful
work. Now, we're bringing together the world's largest
marketplace for care with the leader in scaling and growing
marketplace businesses. We are excited to work with Tim and IAC's
leadership and believe this transaction will deliver value to all
our stakeholders."
As part of IAC, Care.com will benefit from IAC's history of
building scaled marketplace businesses in verticals such as travel,
dating and home services. In particular, IAC is focused on growth
in the following areas:
- Product Innovation: Opportunity to engage a growing
number of users to connect and transact instantly.
- Monetization and Marketing: Deploy deep operational
expertise in customer acquisition and marketing including
transaction-based and subscription models.
- New Growth Areas: With 35 million households including
an adult age 65 or over, the number of people in the US needing
senior care is large and growing and is currently Care.com's
fastest growing segment. Corporate care benefits are also an
expanding category with only 15 percent of employers offering such
benefits today. Care.com's Care@Work operations provide subsidized
and vetted backup care for children and adults, as well as senior
care planning, and allows Care.com to partner with top employers to
offer increasingly relevant services to working families.
- Safety and Trust: IAC is committed to operating
marketplace businesses that put safety first and understands the
investments that need to be made to do so. Earlier this year,
Care.com announced sweeping changes to safety that are leading the
industry.
Given the multiple untapped growth opportunities within
Care.com's business combined with a number of transaction
adjustments, the company will focus on investing to accelerate
Care.com's leadership position and doesn't expect to deliver
positive operating profit during the first year of
ownership.
The transaction is expected to close in the first quarter of
2020.
Transaction Details
Under the terms of the merger agreement, IAC, through its
directly owned acquisition subsidiary, will commence a tender offer
to acquire all outstanding shares of Care.com. Pursuant to the
tender offer, stockholders of Care.com will be able to tender their
shares of Care.com common stock in exchange for $15.00 per share in cash. In addition, the holder
of Care.com series A convertible preferred stock will be able to
tender its shares in exchange for a cash payment equal to 150% of
its liquidation preference, plus accrued and unpaid dividends.
Certain of the Company's largest stockholders, including Ms.
Marcelo, representing a significant portion of the outstanding
shares of the Company have entered into Support Agreements
committing them to tender their shares into the tender offer.
The closing of the tender offer will be subject to certain
conditions, including the tender of shares representing at least a
majority of the voting power of Care.com's outstanding shares, the
expiration of the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act, and other customary conditions. Upon
the successful completion of the tender offer, IAC's acquisition
subsidiary will be merged into Care.com, and any remaining shares
of Care.com will be canceled and converted into the right to
receive the same consideration payable pursuant to the tender
offer. Following completion of the merger, the common stock of
Care.com will no longer be listed for trading on the New York Stock
Exchange. The transaction is expected to close in the first quarter
of 2020.
About IAC
IAC (NASDAQ: IAC) builds companies. We are guided by curiosity,
a questioning of the status quo, and a desire to invent or acquire
new products and brands. From the single seed that started as IAC
over two decades ago have emerged 10 public companies and
generations of exceptional leaders. We will always evolve, but our
basic principles of financially-disciplined opportunism will never
change. IAC today operates Vimeo and Dotdash, among many others,
and also has majority ownership of both Match Group, which includes
Tinder, Match, PlentyOfFish, OkCupid and Hinge, and ANGI
Homeservices, which includes HomeAdvisor, Angie's List
and Handy. The Company is headquartered in New York City and has business operations and
satellite offices worldwide. Learn more at www.iac.com.
About Care.com
Since launching in 2007, Care.com (NYSE: CRCM) has been
committed to solving the complex care challenges that impact
families, caregivers, employers, and care service companies. Today,
Care.com is the world's largest online destination for finding and
managing family care, with 19.8 million families and 14.3 million
caregivers* across more than 20 countries, including the U.S., UK,
Canada and parts of Western Europe, and approximately 1.7 million
employees of corporate clients having access to our services.
Spanning child care to senior care, pet care, housekeeping and
more, Care.com provides a sweeping array of services for families
and caregivers to find, manage and pay for care or find employment.
These include: a comprehensive suite of safety tools and resources
members may use to help make more informed hiring decisions - such
as third-party background check services, monitored messaging, and
tips on hiring best practices; easy ways for caregivers to be paid
online or via mobile app; and Care.com Benefits,
including the household payroll and tax services provided
by Care.com HomePay and the Care Benefit Bucks program, a
peer-to-peer pooled, portable benefits platform funded by household
employer contributions which provides caregivers access to
professional benefits. For enterprise clients, Care.com builds
customized benefits packages covering child care, back up care and
senior care consulting services through its Care@Work business, and
serves care businesses with marketing and recruiting support.
Headquartered in Waltham,
Massachusetts, Care.com has offices in Berlin, Austin and the San Francisco Bay area.
Cautionary Statement on Forward-Looking Statements
This press release may contain "forward-looking statements"
within the meaning of the Federal Private Securities Litigation
Reform Act of 1995. The use of words such as "anticipates,"
"hopes," "may," "should," "intends," "projects," "estimates,"
"expects," "plans" and "believes," among others, generally identify
forward-looking statements. These forward-looking statements
include, among others, statements relating to IAC's or Care.com's
future financial performance, business prospects and strategy,
including the tender offer, the merger, the ability to successfully
complete such transactions and other similar matters. Actual
results could differ materially from those contained in these
forward-looking statements for a variety of reasons, including,
among others, the risks and uncertainties inherent in the tender
offer and the merger, including, among other things, regarding how
many of Care.com stockholders will tender their shares in the
tender offer, the possibility that competing offers will be made,
the ability to obtain requisite regulatory approvals relating to
the acquisition, the ability to satisfy the conditions to the
closing of the tender offer and the merger, the expected timing of
the tender offer and the merger, difficulties or unanticipated
expenses in connection with integrating Care.com's operations,
products and employees into IAC's and the possibility that
anticipated synergies and other benefits of the transaction will
not be realized in the amounts anticipated, within the expected
timeframe or at all, the effect of the announcement of the tender
offer and the merger on IAC's and Care.com's business relationships
(including, without limitations, partners and customers), the
occurrence of any event, change or other circumstances that could
give rise to the termination of the Merger Agreement, the expected
tax treatment of the transaction, and the impact of the transaction
on the businesses of IAC and Care.com, and other circumstances
beyond IAC's and Care.com's control. You should not place undue
reliance on these forward looking statements. Certain of these and
other risks and uncertainties are discussed in IAC's and Care.com's
filings with the Securities and Exchange Commission ("SEC"),
including the Schedule TO (including the offer to purchase, letter
of transmittal and related documents) IAC will file with the SEC,
and the Solicitation/Recommendation Statement on Schedule 14D-9
Care.com will file with the SEC.
Additional Information and Where to Find It
The tender offer has not yet commenced. This press release is
for informational purposes only and is neither an offer to purchase
nor a solicitation of an offer to sell any shares of common or
preferred stock of Care.com or any other securities, nor is it a
substitute for the tender offer materials that IAC and Buzz Merger
Sub Inc. ("Merger Sub") will file with the SEC upon commencement of
the tender offer. At the time the tender offer is commenced, IAC
and Merger Sub will file tender offer materials on Schedule TO,
including an offer to purchase, a letter of transmittal and related
documents with the SEC, and Care.com will file a
Solicitation/Recommendation Statement on Schedule 14D-9 with the
SEC with respect to the offer. The offer to purchase all of the
issued and outstanding shares of Care.com common and preferred
stock will only be made pursuant to the offer to purchase, the
letter of transmittal, and related documents filed as a part of the
Schedule TO. THE TENDER OFFER MATERIALS (INCLUDING AN OFFER TO
PURCHASE, A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER TENDER
OFFER DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT ON
SCHEDULE 14D-9 WILL CONTAIN IMPORTANT INFORMATION THAT STOCKHOLDERS
OF CARE.COM ARE URGED TO READ CAREFULLY WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION SUCH HOLDERS SHOULD
CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR
SHARES. The tender offer materials and the
Solicitation/Recommendation Statement will be made available for
free at the SEC's website at www.sec.gov. Copies of the documents
filed with the SEC by IAC will be available free of charge on IAC's
website. In addition, security holders of Care.com may obtain free
copies of the tender offer materials by contacting the information
agent for the tender offer that will be named in the Tender Offer
Statement on Schedule TO. Copies of the documents filed with the
SEC by Care.com will be available free of charge on Care.com's
website.
Contact Us
IAC Investor Relations
Mark
Schneider
(212) 314-7400
IAC Corporate Communications
Valerie Combs
(212) 314-7361
Care.com Investor Relations
Peter Stabel
ICR, Inc.
781-795-7244
Care.com Corporate Communications
Nancy Bushkin
781-642-5919
Care.com Corporate Communications
Jim Barron/Sard Verbinnen
212-687-8080
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SOURCE IAC; Care.com
