CBS buys CNET in $1.8B deal
NEW YORK (AP) — Media and entertainment company CBS Corp. is buying CNet Networks Inc., an online news and information provider, for $1.8 billion in cash in its latest bid to expand its reach on the Internet, the companies announced Thursday.
The price of $11.50 per share represents a massive premium of 45 percent over CNet's closing stock price on Wednesday, and appears to get CNet out of a nasty battle with one of its largest shareholders, which had been agitating for a shakeup at the company after its stock slumped.
CNet shares jumped $3.48, or 44 percent, to $11.43 in morning trading Thursday. Investors didn't see the deal as positively for CBS, and pushed that company's shares down 89 cents, or 3.6 percent, to $23.93. Citigroup analyst Jason Bazinet said in a note that the "pricing risk is high" for CBS.
CBS's CEO Leslie Moonves told reporters on a conference call that acquiring access to CNet's large online audience in order to distribute media content from CBS was "a large part" of CBS' motivation in going after the San Francisco-based online company.