Experian’s PriceGrabber sale falls through

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Experian, the company that specialises in analysing creditworthiness, failed to complete the agreed disposal of its price-comparison websites after an Indian company did not come up with the cash in time.

The $175m deal for PriceGrabber and LowerMyBills fell through after Ybrant Digital, a marketing company based in Hyderabad, missed Tuesday’s deadline to pay. Experian said it had received assurances from Ybrant that financing for the deal was in place.

Ybrant in May agreed to buy PriceGrabber and others for $100m in cash plus a deferred payment of $75m. Experian said it deemed Ybrant’s failure to pay to be a “breach of contract”.

In the run-up to the deadline, however, Ybrant and Experian discussed altering the terms of the deal. Experian declined to comment on what these new potential terms were, while Ybrant could not be reached for comment.

Experian confirmed it remained “committed” to selling PriceGrabber, which it considers “non-core”. The credit checker paid $485m in 2005 for the websites, which focus on consumer electronics and household goods.

The FTSE 100 group had been looking to sell the websites since 2008, when the group decided to focus on data and credit analysis. Before it fell through, the deal left Experian nursing a heavy deficit compared to the original price, even after including earnings from the websites.

Experian had a number of suitors for the business before it signed the deal with Ybrant, according to analysts. When the deal was announced in May, Don Rober, chief executive of Experian, said: “These are great businesses. They are just not good businesses for us.”

Justin Jordan, analyst at Jefferies, said any new deal might be on better terms because of PriceGrabber’s improved recent performance. Organic revenue growth at the price comparison website was 1 per cent higher in the past five months.

It reported revenues of $300m in the year to March 2012, compared with Experian as a whole, which enjoyed revenues of $4.5bn in its most recent financial year. Experian enjoyed profit before tax of $689m last year, up 5 per cent year-on-year.

Shares in Experian moved in line with a falling London market, dropping 1 per cent to £10.23. Shares in Ybrant, which is listed on the Bombay Stock Exchange and has a market capitalisation of almost Rs37bn ($690m), rose 2.2 per cent at Rs77.60.

Additional reporting by James Crabtree in Mumbai

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