Everything You Need To Know About The IAC Merger With Angie's List

Shares of Angie's List Inc ANGI soared higher by more than 50 percent early Tuesday morning after the local services consumer review platform received a takeover offer from IAC/InterActiveCorp IAC, which has been approved by the boards of both companies.

As part of a merger agreement, IAC's HomeAdvisor unit would combine with Angie's List and then spin off into a new publicly traded company called ANGI Homeservices Inc. IAC believes the combination of the two platforms would create one of "unparalleled scale and product breadth" and a key part of the $400 billion domestic home services market.

IAC and its HomeAdvisor unit will pay Angie's stockholders $8.50 per share in cash or one share of Class A common stock of ANGI Homeservices.

Angie's List has been exploring strategic alternatives since November 1, 2016, as doing so would unlock the "full potential" of its platform.

Oppenheimer: 'Fair' Deal

Oppenheimer's Jason Helfstein commented in a research report that the deal appears to be "fair" for all parties as HomeAdvisor could make up the "substantial" 44 percent premium in the acquisition price tag with operational synergies.

HomeAdvisor could also be able to leverage Angie's List 92 percent aided brand awareness in increasing conversions and also Angie's List's traffic could be more easily monetized using its Instant Bookings & Instant Connect tools.

Meanwhile, Angie's List's investors received a "lifeboat" as the company's prospects as a stand-alone entity are limited without new financing.

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