NEW YORK, Oct. 10, 2011 /PRNewswire via COMTEX/ -- InsWeb Corporation (NASDAQ: INSW) and Bankrate, Inc. (NYSE: RATE) announced today that they have entered into a definitive agreement for InsWeb to sell substantially all of its assets relating to its insurance lead generation and marketing business to Bankrate for $65 million in cash at closing, subject to a working capital adjustment specified in the agreement.
InsWeb will retain a portfolio of e-commerce and online insurance distribution patents, which it will license to Bankrate on a perpetual, royalty-free, non-exclusive basis. Bankrate has entered into voting agreements with shareholders representing approximately 40% of InsWeb's currently outstanding shares in connection with the transaction. Under the terms of the agreement, Bankrate will also assume certain liabilities of InsWeb, as further specified in the agreement. Following the closing, InsWeb is expected to continue as a public company and will focus on a new business model in which it will license its patented technologies.
"We are excited about this transaction and the value that it delivers to us and our shareholders," said Hussein A. Enan, Chairman of the Board and Chief Executive Officer of InsWeb. "The purchase price represents a compelling valuation for the business, while we believe the retention of our patent portfolio and our planned efforts to license the proprietary technologies we have developed over the years provides potential upside to our shareholders. Competition in online lead generation services continues to be dynamic, and the ability to monetize leads effectively is increasingly important. Bankrate's strong online distribution network is an ideal fit for our customers and consumers, who will continue to be well served in the marketplace."
"The InsWeb assets represent a great addition to the Bankrate insurance business," said Thomas R. Evans, President and Chief Executive Officer of Bankrate, Inc. "We anticipate that InsWeb's large agent base and lead sources will complement our existing insurance offering and create opportunities for substantial synergies. Once closed, we expect this acquisition to be immediately accretive."
InsWeb's board of directors unanimously approved the agreement. The transaction is subject to customary closing conditions, including regulatory approvals and the approval of InsWeb's shareholders. The agreement contains several other terms and further details expanding on the information included in this press release, and a copy of the agreement will be filed with the SEC by InsWeb.
InsWeb was advised as to financial matters by GCA Savvian, and as to legal matters by Sidley Austin LLP. Bankrate was advised in this transaction as to legal matters by Wachtell, Lipton, Rosen & Katz.
About InsWeb Corporation
InsWeb Corporation owns and operates a network of leading insurance marketplace and education websites. Founded in 1995 and headquartered in Sacramento, California, InsWeb's primary properties include InsWeb.com, InsuranceRates.com, LocalInsuranceAgents.com, MedHealthInsurance.com and AgentInsider.com. InsWeb has invented multiple e-commerce and online insurance distribution technologies and owns the following patents: 6,898,597; 7,107,325; 7,389,246; 7,640,176 and 7,707,505.
About Bankrate, Inc.
Bankrate is a leading publisher, aggregator and distributor of personal finance content on the Internet. Bankrate provides consumers with proprietary, fully researched, comprehensive, independent and objective personal finance editorial content across multiple vertical categories including mortgages, deposits, insurance, credit cards, and other categories, such as retirement, automobile loans, and taxes. The Bankrate network includes Bankrate.com, our flagship website, and other owned and operated personal finance websites, including CreditCards.com, Interest.com, Bankaholic.com, Mortgage-calc.com, CreditCardGuide.com, Nationwide Card Services, InsuranceQuotes.com, CarInsuranceQuotes.com, InsureMe, Bankrate.com.cn, CreditCards.ca, NetQuote, and CD.com. Bankrate aggregates rate information from over 4,800 institutions on more than 300 financial products. With coverage of nearly 600 local markets in all 50 U.S. states, Bankrate generates over 172,000 distinct rate tables capturing on average over three million pieces of information daily. Bankrate develops and provides web services to over 75 co-branded websites with online partners, including some of the most trusted and frequently visited personal finance sites on the Internet such as Yahoo!, AOL, CNBC and Bloomberg. In addition, Bankrate licenses editorial content to over 100 newspapers on a daily basis including The Wall Street Journal, USA Today, The New York Times, The Los Angeles Times and The Boston Globe.