Local.com is beginning to make some rather interesting news lately which may help to push them into the local search spotlight (beyond their awesome domain name). Local.com announced today that they will be acquiring soUno Directional Media Solutions, LLC, which is a provider of online yellow pages advertising to small businesses.
Local.com plans to acquire soUno for $2.25 million in cash plus $6.75 million in Local.com common stock. Additionally, certain soUno employees are eligible to earn up to $4.5 million in cash and common stock over the two-year period following the closing based upon the achievement of specific financial objectives.
More from the press release on the acquisition and about soUno:
soUno markets online yellow pages advertising to small businesses nationwide. soUno’s 13,000 local advertisers each pay an average of approximately $300 per year for inclusion in search results on www.souno.com. soUno has local exchange carrier (LEC) billing capabilities in 50 states, giving advertisers the option of paying their online advertising fees with their phone bills. Based in Tulsa , Oklahoma , soUno has approximately 20 employees.
Local.com powers www.souno.com with its LocalConnect search platform, which provides both algorithmic search results as well as a local ad serving platform that soUno utilizes for advertiser account management purposes.
Following the transaction:
* soUno will be incorporated into Local.com
* Local.com will provide soUno advertisers with premium placement on www.local.com
* soUno will expand Local.com’s direct marketing efforts in order to continue growing the number of proprietary local advertisers
* New ad products will be co-developed, engineered by Local.com, and sold by soUno to small and medium sized businesses
* Local.com will develop new search engine marketing campaigns in order to complement soUno’s marketing effortswww.souno.com attracts approximately 150,000 unique monthly visitors. New and existing advertisers will be placed on www.local.com, which attracts around 10 million unique monthly visitors, providing an improved value proposition for soUno’s advertisers. Local.com believes this will also improve the return on soUno’s marketing efforts. The acquisition of soUno provides Local.com a sizeable entry into the sub-$500/year advertiser market.
“We have been impressed with soUno’s growth during our partnership and feel we share a common vision in local search,” said Heath Clarke , Local.com CEO. “There are considerable synergies we intend to leverage – Local.com has great search traffic and leading technologies, and soUno has developed an efficient sales channel. We believe that working together enables us to grow our business even faster. We look forward to working closely with the soUno team on integrating our efforts to become the leader in local search.”
“We are excited to become part of the Local.com team,” said Lynn Mitchell, soUno CEO. “We believe this transaction provides us with the ability to build upon our respective strengths and capitalize on the enormous opportunity in the local search market. Local.com will allow us to deliver an even better product to existing soUno advertisers as well as to attract and retain new advertisers.”
The acquisition is subject to the completion of due diligence, negotiation and execution of a definitive agreement, approval by Local.com shareholders, as well as customary closing conditions. Closing is expected to take place in April 2007. Additional information related to this transaction will be disclosed with the execution of the definitive agreement.
Financial Highlights
According to soUno, unaudited 2006 financial results indicate that soUno achieved approximately $2.8 million in revenue and was cash flow positive. soUno is expected to be accretive to Local.com earnings in 2007.
