Angie’s List on Tuesday rejected a $512 million takeover offer by IAC/InterActive, saying the Nov. 11 bid “dramatically undervalues the company and its long-term standalone prospects.”
The Indianapolis-based company said IAC’s $8.75 per share cash proposal represented only a 10% premium at the time (November 11) it was made. But IAC says that the $8.75 figure represents a 50% premium to Angie’s List’s share price one month ago.
“The board believes that it should have the opportunity to fully evaluate our profitable growth plan and should share that plan with shareholders before reaching a decision as to whether to engage in a transaction with IAC or any other party,” Angie’s List president and chief executive Scott Durchslag said in a press release.
IAC, which operates dating sites and apps Tinder, Match and OkCupid, recently filed for an IPO. Acquiring Angie’s List would help it expand into home remodeling and contracted professional services.
IAC CEO Joey Levin reached out to Angie’s List management in late October, according to a letter Durchslag sent to Levin, and the board had the same response at that time.
Angie’s List will announce the details of its growth plan next quarter at its investor day, the company said.
According to the Indianapolis Star, Angie’s List last month announced two measures to guarantee its customers a fair price and quality of service. The business promised that if a service isn’t satisfactory, it either will make it good or reimburse the customer up to $100,000. It also pledged to pay customers the difference on goods purchased within 30 days if they find a better deal.
Angie’s List shares were trading at $9.87 at 2:30 p.m. Eastern, up 0.41%.