DoubleClick bought for $1.5 billion

Who said there was no money in online advertising?

Two US private equity firms have bought online advertising company DoubleClick for US$1.1 billion (NZ$1.5 billion), DoubleClick announced Monday.

The firms, Hellman and Friedman LLC of San Francisco and JMI Equity of San Diego, expect to complete the deal in the third quarter, DoubleClick says. JMI Equity, which focuses on the software and business service industries, will hold a minority interest.

Representatives from DoubleClick and Hellman and Friedman could not immediately be reached for comment.

Hellman and Friedman sees the acquisition of DoubleClick, in New York, as an opportunity to extend its online advertising and marketing and data businesses, in part though the recognisable DoubleClick brand as well as utilising its experienced staff, the company says. The company's board of directors has approved the deal, which is still subject to shareholder approval and other closing conditions.

The company's core business is serving ads to websites, a market that has become increasingly competitive with Yahoo, Google and others entering the fray to drive down prices. In 2004, DoubleClick hired investment bank Lazard Freres to evaluate future options for the business including a recapitalisation, extraordinary dividend, share repurchase or a spin-off.

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