Apax Agrees To Take Bankrate Private

NEW YORK (Reuters) – Bankrate Inc (RATE.O), which operates Bankrate.com and other personal finance websites, said on Wednesday it agreed to a $571 million buyout by private equity firm Apax Partners.

Apax plans to pay $28.50 per share in cash for Bankrate, a 15.8 percent premium over the company’s Tuesday closing price, starting with a tender offer for outstanding shares.

In afternoon trading, Bankrate shares were up $4.36, or 17.7 percent, at $28.98 on the Nasdaq. The buyout was announced moments before a trading halt, and the shares last traded at $28.37 prior to that halt.

Bankrate has been struggling with falling advertising revenue stemming from the weak economy.

In a separate announcement, the North Palm Beach, Florida-based company said second-quarter profit declined by a larger-than-expected 53 percent, and that second-quarter and full-year revenue will be well below analyst forecasts.

Apax’s offer provides “significantly enhanced flexibility” to navigate a “difficult economic climate,” Thomas Evans, chief executive of Bankrate, said in a statement.

Bankrate.com aggregates data on more than 300 financial products, including auto loans, bank accounts and fees, credit cards, and mortgages and home equity loans. It said it had more than 72 million viewers in 2008.

Bankrate said its board has approved the acquisition, which has support from holders of 24 percent of the company’s shares. It said Apax plans to begin its tender offer by July 28, and to complete the merger at the end of September.

The company reported quarterly profit of $1.93 million, or 10 cents per share, on revenue of $31 million. Excluding items, it said profit was 19 cents per share. Analysts on average expected profit of 30 cents per share on revenue of $37.5 million, according to Reuters Estimates.

Allen & Co and the law firm Wachtell, Lipton, Rosen & Katz advised Bankrate on the transaction. Stephens Inc and the law firm Kirkland & Ellis LLP advised Apax. Allen & Co and Needham & Co provided fairness opinions. (Reporting by Jonathan Stempel; Editing by Steve Orlofsky)