IVillage and Women.com yesterday announced plans to merge, consolidating two of the more popular, yet financially struggling, sites for women on the Internet. Technically, iVillage is buying Women.com
for $25 million, but the combined company is being helped out a lot by Women.com's largest shareholder, the Hearst Corp.
Hearst is giving iVillage a $20 million cash infusion, and is also promising
to buy at least $15 million in production and advertising services over the next three years. Hearst, currently owning 46% of Women.com, will wind up with about 30% of the combined company.
IVillage
also reported earnings late Monday which warned that its revenues in the first quarter of 2001 would decline by 25% due to a slowdown in advertising - a slowdown they hope to stop with the
merger.
Shares in Women.com were in danger of being taken off of the NASDAQ, as they were trading below the $1 minimum, and iVillage had gone from trading at more than $100 a share in April 1999, to
its current $1.72 price tag. - Adam Bernard