PE Firm Buys Internet Brands For $640 Million

PE firm Hellman and Friedman is buying Internet Brands, which owns a portfolio of more than 100 websites, including and car site CarsDirect, for $640 million. The deal comes three years after Internet Brands went public at $8 a share. Hellman and Friedman is paying $13.35 a share for the company, a 46.5 percent premium to its most recent closing price.

Internet Brands has historically been extremely acquisitive, buying up sites to bulk up its position in the verticals it targets, which include autos, careers, health, home, travel and shopping verticals. So far this year, it has spent $16.2 million buying up nine sites, including ExpertHub, a network of sites that let consumers look up professionals like dentists, accountants, and lawyers.

The company’s revenue dropped four percent to $99.8 million in 2009, a fall it attributed to a decrease in the demand for cars; net income was up slightly to $12.4 million from $11.6 million. Internet Brands’ financial performance has been much better this year, and the company forecast in April that revenue would be up 14 to 17 percent for the year.

In a release, Hellman and Friedman Managing Director Andy Ballard credits the company for building “an impressive platform for branded vertical websites.” He doesn’t specify what the company’s plans for Internet Brands are.

In the media space, Hellman and Friedman’s holdings include Getty Images, which it purchased two years ago. It was also a member of the consortium of PE firms that bought Nielsen Co. in 2006, and it was one of two PE firms that took DoubleClick private before selling that company to Google (NSDQ: GOOG) in 2007.