Filed by IAC/InterActiveCorp
Pursuant to Rule 425
Under the Securities Act of 1933
Deemed filed pursuant to Rule
14a-12 Under the Securities
Exchange Act of 1934
Commission File No. 0-20570
For Immediate Release
[IAC/InterActiveCorp LOGO]
IAC/InterActiveCorp to Acquire Ask Jeeves, Inc.
Combines Leading Interactive Commerce Brands
with Top-Tier Search Engine
NEW YORK and OAKLAND, Calif., - March 21, 2005 - IAC/ InterActiveCorp (Nasdaq:
IACI) and Ask Jeeves, Inc. (Nasdaq: ASKJ) today announced they have signed an
agreement under which IAC will purchase Ask Jeeves. Under the terms of the
agreement, IAC will issue 1.2668 shares of common stock for each share of Ask
Jeeves common stock in a tax-free transaction valued at $1.85 billion net of
cash acquired. IAC intends to buy back through its previously authorized share
repurchase programs at least 60% of the number of shares it will issue for this
acquisition, thus effectively offsetting a substantial portion of the dilution
from the transaction with cash. IAC expects the acquisition to be accretive to
2005 Adjusted EPS assuming the buyback at the 60% level.
Barry Diller, Chairman and CEO of IAC, said, "Ask Jeeves was founded almost ten
years ago based on the idea that simple text search results alone are not
sufficient or satisfying - but, rather, that consumers want ANSWERS TO QUESTIONS
- - AND QUESTIONS POSED IN NATURAL LANGUAGE AND ANSWERED WITH SPOT-ON ACCURACY
WERE ESPECIALLY DESIRED AND APPEALING. Of the many search engines launched
during that time, Ask was one of the very few that established itself ... and we
believe that in the future it has the potential to become one of THE great
brands on the Internet and beyond, and by beyond we mean in wireless, in the
search for anything on any device. It is that belief, powered by IAC's wealth of
resources and thriving businesses, together with the continuing strong
management of Steve Berkowitz and his team, that is the impetus for this
transaction."
The online advertising and search markets are growing rapidly; of the $260
billion in total U.S. advertising spend in 2004, less than $10 billion, or 4%,
is online, with an expected annual growth rate of 13%. Search is now 36% of U.S.
online advertising and expected to grow 24% per year over the next five years (
Source: Merrill Lynch Equity Research.)
Ask Jeeves is one of four world-class search technology providers, with
approximately 42 million U.S. unique monthly users,* and is one of the largest
generators of online advertising in the world.
IAC operates more than 40 specialized consumer brands in the travel, retailing,
ticketing, personals, media, financial services, real estate and teleservices
industries. IAC's businesses are leaders in their respective categories and
collectively reach 44 million U.S. unique users monthly.* IAC enables billions
of dollars in consumer-direct transactions for products and services sourced
from more than 140,000 merchant partners, suppliers, vendors, venues, lenders,
and real estate brokerages.
The combined companies will continue building Ask Jeeves as one of the great
brands on the Internet by:
- continuing Ask Jeeves' growth trajectory by applying IAC's proven
experience in brand management and marketing, as well as through
investment in distribution, R&D, technology and infrastructure, and
international markets.
- leveraging IAC's leading brands and pioneering new search revenue
models by vertically integrating IAC's transaction brands and offers
into the Ask Jeeves properties.
- making Ask Jeeves the search engine with the best local search,
content and merchant information on the Web - increasing the
distribution of IAC Local merchants and enhancing Ask Jeeves' local
offering.
- promoting the Ask Jeeves search box on every IAC site, exposing 44
million unique users per month to the Ask Jeeves brand.
"Ask Jeeves is a pioneer in search and has grown to become one of the leading
search providers through advanced technology and a suite of brands that are
differentiated by both value proposition and delivery," said Steve Berkowitz,
CEO of Ask Jeeves, Inc. "Joining IAC will enable us to play on a much larger
field. We are excited about the opportunity to serve as the connection between
IAC's constellation of leading online properties to share users and content. Ask
Jeeves will now be in an even stronger position to aggressively grow market
share."
Ask Jeeves will remain an independent brand with operations headquartered in
Oakland, Calif. following completion of the acquisition. Steve Berkowitz will
continue as Ask Jeeves' CEO. The transaction is subject to customary closing
conditions, including regulatory approval and the approval of Ask Jeeves
shareholders, and is expected to close late in the second quarter or early in
the third quarter of 2005, prior to IAC's spin-off of its travel businesses.
Following the spin-off, Ask Jeeves will remain part of IAC.
Wachtell, Lipton, Rosen & Katz acted as legal advisor and JP Morgan as financial
advisor to IAC during this transaction. Gibson Dunn & Crutcher acted as legal
advisor and Allen & Company and Citigroup Global Markets as financial advisors
to Ask Jeeves during this transaction.
* IAC AND ASK JEEVES UNIQUE USER DATA PER COMSCORE MEDIA METRIX 2005.
CONFERENCE CALL
- ---------------
IAC will audiocast a conference call with investors and analysts discussing the
transaction on Monday, March 21, 2005, at 11:00 a.m. Eastern Time (ET). The live
audiocast is open to the public at http://www.iac.com/investors.html.
ABOUT ASK JEEVES, INC.
- ----------------------
As the 9th largest global web property (ComScore Media Metrix), Ask Jeeves Inc.
delivers world-class information retrieval products through a diverse portfolio
of Web
sites, portals and downloadable applications. Ask Jeeves' search and
search-based portal brands include: Ask Jeeves (Ask.com and Ask.co.uk), the Ask
Jeeves Japan joint venture (Ask.jp), Ask Jeeves for Kids ( AJKids.com),
Bloglines (bloglines.com), Excite (excite.com), iWon (iwon.com), My Way
(myway.com) and Fun Web Products (funwebproducts.com). Additionally, Ask Jeeves
owns the differentiated search technology Teoma, as well as natural language
processing, portal and ad-serving technologies. Ask Jeeves generates revenue
from advertisers seeking to reach the company's broad-based online audience.
Founded in 1996, Ask Jeeves has been a publicly traded company on the Nasdaq
National Market since July 1999. Its headquarters are located in Oakland,
California, with offices throughout the United States, as well as in Europe and
Asia. For more information, visit http://www.Ask.com.
ABOUT IAC/INTERACTIVECORP
- -------------------------
IAC operates leading and diversified businesses in sectors being transformed by
the internet, online and offline... our mission is to harness the power of
interactivity to make daily life easier and more productive for people all over
the world. To view a full list of the companies of IAC please visit our website
at http://iac.com.
WHERE TO FIND ADDITIONAL INFORMATION ABOUT THE ACQUISITION
- ----------------------------------------------------------
IAC intends to file a registration statement with the Securities and Exchange
Commission ("SEC") that will include a combined proxy statement/prospectus of
Ask Jeeves and IAC and other relevant documents in connection with the proposed
merger. ASK JEEVES STOCKHOLDERS SHOULD READ THE PROXY STATEMENT/PROSPECTUS AND
OTHER RELEVANT MATERIALS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT ASK JEEVES, IAC AND THE PROPOSED MERGER.
In addition to the documents described above, Ask Jeeves and IAC file annual,
quarterly and current reports, proxy statements and other information with the
SEC. The proxy statement/prospectus and other relevant materials (when they
become available), and any other documents filed with the SEC by Ask Jeeves or
IAC are available without charge at the SEC's website at http://www.sec.gov, or
from the companies' websites, at http://www.ask.com and http://www.iac.com,
respectively.
Ask Jeeves, IAC and their respective officers and directors may be deemed to be
participants in the solicitation of proxies from Ask Jeeves stockholders in
connection with the proposed merger. A description of certain interests of the
directors and executive officers of Ask Jeeves is set forth in Ask Jeeves' proxy
statement for its 2004 annual meeting, which was filed with the SEC on April 16,
2004. A description of certain interests of the directors and executive officers
of IAC is set forth in IAC's proxy statement for its 2004 annual meeting, which
was filed with the SEC on April 29, 2004. Additional information regarding the
interests of such potential participants will be included in the definitive
proxy statement/ prospectus and other relevant documents to be filed with the
SEC in connection with the proposed merger.
WHERE TO FIND ADDITIONAL INFORMATION ABOUT THE IAC SPIN-OFF
- -----------------------------------------------------------
In connection with the proposed spin-off it is currently expected that IAC will
file a proxy statement/prospectus with the Securities and Exchange Commission
(the "SEC").
Stockholders of IAC are urged to read the proxy statement/prospectus, when it
becomes available, because it will contain important information about IAC, the
proposed spin-off transaction and related matters. Investors and security
holders can obtain free copies of the proxy statement/prospectus when it becomes
available by contacting Investor Relations, IAC/InterActiveCorp, Carnegie Hall
Tower, 152 W. 57th Street, 42nd Floor, New York, NY 10019 (Telephone: (212)
314-7400). Investors and security holders can also obtain free copies of the
proxy statement/prospectus and other documents filed by IAC and Expedia with the
SEC in connection with the proposed spin-off transaction at the SEC's web site
at http://www.sec.gov.
In addition to the proxy statement, IAC files annual, quarterly and current
reports, proxy statements and other information with the SEC, each of which
should be available at the SEC's web site at http://www.sec.gov. You may also
read and copy any reports, statements and other information filed by IAC at the
SEC public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549.
Please call the SEC at 1-800-SEC-0330 for further information.
IAC and its directors, executive officers and certain members of management and
other employees may be deemed to be participants in the solicitation of proxies
of IAC's stockholders to approve the proposed spin-off transaction. Such
individuals may have interests in the transaction as described herein, including
as a result of current holdings of options or shares of IAC's stock and future
holdings of options or shares of Expedia's stock, which will be impacted in the
transaction. Information regarding IAC and the equity interests of its directors
and officers who may be deemed to be participants in the solicitation of proxies
is contained in IAC's proxy statement, filed with the SEC on April 29, 2004.
CONTACTS:
For IAC:
- --------
IAC CORPORATE COMMUNICATIONS
Andrea Riggs 212/314-7280
Deborah Roth 212/314-7254
IAC INVESTOR RELATIONS:
212/314-7400
Roger Clark
Lauren Porat
FOR ASK JEEVES:
- ---------------
ASK JEEVES CORPORATE COMMUNICATIONS
Heather Staples 510/985-7610
ASK JEEVES INVESTOR RELATIONS
Derrick Nueman 510/985-7485