MoneySupermarket.com adds to its group with the acquisition of MoneySavingExpert.com for £87 million. Final completion is still reliant on clearance by the Office of Fair Trading and shareholder approval, which could mean the deal is concluded in either September or October 2012.
The purchase is to be structured partly with a £35 million cash payment upfront and an estimated 22.1 million in MoneySupermarket.com shares. In addition there’ll be a deferred consideration of up to £27 million, which will take into account the future performance of MoneySavingExpert.com against non-financial metrics. The targets are said to be based on growth and trust in the site.
Financial results for MoneySavingExpert.com show reported revenues of £15.8 million for the year ending 31st October 2011 compared to £11.4 million in 2010. EBITDA was £12.6 million in, whereas in 2010 it was £8.4 million. Google Analytics reported approximately 39 million unique visitors and 277 million page impressions during the same October-ending year, figures that will have likely made a substantial contribution to MSE’s revenue.
Concerns over the future independence of MoneySavingExpert.com have been addressed in a Q&A; on its website. Parallels were drawn between MoneySupermarket.com’s new ownership of MSE and the BBC’s running of Radio 4 and Radio 5. Both stations continue to have their own voice and it’s envisaged MoneySavingExpert.com will also see little change. A new editorial code was alluded to, which will mean MSE is free to review MoneySupermarket.com’s services without bias.
Martin Lewis disclosed he will be donating some of the money he earns from the sale to causes for helping those in need of financial advice, which has been the general ethos of MSE since its inception. “In keeping with the site’s aims, when the deal completes, £10 million will go to charity, including £1 million to Citizens Advice, which is facing terrible funding cuts,” he said.
Lewis’ role will now be as Editor in Chief where he’ll lead the editorial team at MSE for at least three years. He’ll retain full control over the website and there will be the option for him to continue beyond the three-year period. MoneySupermarket.com will be providing extra assistance with human resources, technology, IT and web compliance.
MoneySupermarket.com’s input will be in a purely technological sense. MSE will be taking advantage of this tech expertise and using it to improve what some deem to be a cluttered site that’s tough to navigate and doesn’t have the greatest search ranking. The end game being for more people to discover MSE’s content, use it and save cash.
Chief Executive Officer of MoneySupermarket.com, Peter Plumb, spoke of the assistance his company is going to give MoneySavingExpert.com in improving the website for the future. “We’ll help MoneySavingExpert.com reach a wider audience and MoneySavingExpert.com will broaden the range of advice and tools we offer, encouraging even more people to take action, tap into the benefits of the internet to find a better deal and make the most of their money,” he said.