M&A Alert - January 20, 2010
BounceBack Buys Universal Business Listings
Transaction Overview
On January 20, 2010, BounceBackTechnologies.com (Pink Sheets: BBTC, market cap: $4.58mm) agreed to acquire the parent company of Universal Business Listings for equity.
Target Description
Universal Business Listings (“UBL”), owned by Name Dynamics, Inc, allows local businesses to list their business profiles on virtually all major on-line business listing sites. In essence, the local business provides key business information to UBL and UBL ensures that the information is provided to key on-line listing sites such as AOL, Citysearch, Yelp, Yellow Pages, Google, Yahoo, Bing, Merchant Circle, map databases from TeleAtlas and NAVTEQ and 411 directory assistance. UBL is a key source for infoUSA and Acxiom, two of the largest list aggregators on the internet. UBL is reportedly the largest list aggregator, competing against infoUSA, iBegin.com, The Local Data Company (U.K.), and Localeze. UBL offers its services directly to businesses via its Website UBL.org and to Interactive Agencies, Publishers and Affiliates through wholesale agreements. UBL was founded by Doyal Bryant (who will take on the role of CEO of BounceBack) and Chris Travers (who will be the President and COO of BounceBack). Mr. Bryant has been a Managing Partner at BlueLake Capital Partners, which provides advisory and investment services to early stage companies, and has been CEO of public internet and telecommunications companies. Mr. Travers has served as an executive at Reuters and Cablevision and was the co-founder of New York-based media and marketing company, Empire Media, as well as CEO of the business search engine, Find.com. UBL is headquartered in Charlotte, North Carolina.
Buyer Description
BouncebackTechnologies.com is a shell public company which is currently traded on the OTC Pink Sheets but does not file any information with the SEC.
The transaction parameters were not disclosed although this appears to be an effort to allow the combined companies to eventually access the public markets for capital. BounceBackTechnologies.com will assume its new name, “Name Dynamics, Inc.” and will change its stock symbol in the near future. The new company intends to begin reporting required information to the SEC and trade on the appropriate exchange, within a time frame of approximately 6 months. The stock currently trades on the “pink sheets” under the symbol of BBTC although it is a highly illiquid security.
Strategic Rationale
It appears that the rationale behind the transaction is as a first step to transition Universal Business Listings into a public company. We anticipate additional steps in the future including initiating SEC filings and potentially some sort of public offering.
Architect Partners’ Observations
While clearly a below the radar transaction, we are highlighting this transaction due to the importance of the directory data that UBL owns for local on-line and mobile advertising. Not only is the data valuable but the direct relationship to the local merchants is an important building block to any company with an ambition to build a local advertising business. Local merchant access is required to effectively offer high-value advertising and marketing packages.
Advertising and marketing are clearly in the midst of a major restructuring as on-line and mobile options become an increasing proportion of where spend is directed by advertisers. The local advertising market is massive. Kelsey Group estimates that local advertising is a $141 billion market today (2009). They estimate that on-line and mobile, which comprises only 11.6% of the market today (2009) will grow to 22% of the market in 2013, representing over $15 billion of revenues up for grabs. Other notable recent activity around the local advertising market includes the IPO filing of ReachLocal in December 2009 and Google’s recent attempt to acquire Yelp.