A F DRAKKAR NOIR DALE EARNHARDT JR. DAY DRAKKAR NOIR DALE EARNHARDT JR. DAY
Racing enthusiasts greeted Dale Earnhardt Jr. as he appeared on behalf of Drakkar Noir to accept the city of Atlanta's Phoenix Proclamation, declaring October 23 the ...
PLEASANTVILLE, N.Y., March 31 /PRNewswire-FirstCall/ -- The Reader's
Digest Association, Inc. (NYSE: RDA) today announced an agreement to acquire
Allrecipes.com, an online community food and cooking website that leverages an
active and growing network of home cooks to generate revenue from advertising
sponsorships and retail licensing. The purchase price is approximately $66
million, and the transaction will be funded using existing debt capacity. RDA
expects to complete the acquisition in its fourth fiscal quarter ending June
30, 2006. The announcement was made by Eric Schrier, President and CEO of
(Photo: http://www.newscom.com/cgi-bin/prnh/20060331/NYF099 )
"We are thrilled that Allrecipes.com will become part of the Reader's
Digest family of companies," Schrier said. "We own the world's largest food
publishing franchise in Taste of Home, along with a fast-growing tapestry of
other food and cooking activities. Our acquisition of Allrecipes.com will
provide us with a valuable digital platform to further leverage our position
as the country's leading food and cooking publisher. It will enable us to
bring together online communities from the various RDA properties using the
common platform of an industry-leading food and cooking affinity."
Allrecipes.com was launched eight years ago as a place for home cooks to
"meet" and share their favorite recipes. Since its launch, it has become the
world's largest online community of home cooks - totaling more than 1.8
million registered members - making it America's favorite Web destination for
everyday and holiday recipes. Each month the site attracts an average of 6
million unique visitors who collectively view more than 70 million page views;
during peak holiday months, traffic spikes to more than 9 million unique
visitors and 111 million page views. It also includes 30,000 of America's
favorite recipes, which are created, tested and reviewed by participating home
"We are delighted to be joining forces with one of the world's marquee
publishing and marketing companies," said Bill Moore, CEO of Allrecipes.com.
"Our business is a natural fit with Reader's Digest as it is such a major
player in the food and lifestyle categories. We expect to take advantage of
powerful synergies and marketing opportunities, and we believe that this
alliance will accelerate our growth both in the United States and abroad.
Together, we have the potential to increase the scale of the Allrecipes.com
audience, revenues and already high profit margins. And we have the content
and technology to expand into other lifestyle affinities."
Moore will report to Bonnie Bachar, RDA's President of U.S. Magazines in
its RD North America segment. Bachar said the Allrecipes.com acquisition
supports RDA's new strategy of deepening customer relationships built around
affinities like food, and reaching new and existing customers through multiple
"As publisher of Taste of Home, the country's highest-circulation food
magazine, as well as other magazines and books on food and cooking topics, we
have been seeking additional platforms to leverage our content, and the Web is
clearly our number one target for this expansion," Bachar said. "The
acquisition of this small but fast-growing company supports our goal of
strengthening RDA's portfolio with new properties that can contribute to long-
term topline growth."
For RDA, Allrecipes.com represents the company's first major Internet
acquisition and continues an overall strategy of building direct marketing and
advertising programs across multiple media platforms. The site will act as a
portal for RDA's existing food websites, which support its magazine properties
like Taste of Home and Light & Tasty. The Allrecipes.com advertising sales
force will sell RDA digital advertising related to food, and RDA's cookbooks
and magazines will be sold on the Allrecipes.com website.
RDA's other food-related activities include Every Day with Rachael Ray,
Taste of Home's cooking schools, an online Taste of Home recipe finder, and
Taste of Home Entertaining, a new national party plan business that is being
launched coast to coast in the United States this spring. In addition to its
five food magazines, the company markets at retail dozens of magazine specials
on food, diet, cooking and wellness. It also sells millions of cookbooks
every year and created an international best-selling proprietary diet book and
website, ChangeOne. Reader's Digest magazine is a major vehicle for food
advertising, and the company expects to accelerate its online advertising
growth in that category.
Michael S. Geltzeiler, Senior Vice President and Chief Financial Officer
of RDA, said, "The company anticipates that Allrecipes.com will contribute
approximately $4 million of EBITDA in the first year, with an expected
earnings-per-share impact of $(0.01) to neutral. The acquisition should not
have a material impact on the company's other initiatives currently underway
to enhance shareholder value, including its $100 million share repurchase
program announced last year."
Geltzeiler added, "The company intends to pursue additional debt capacity,
most likely through the expansion of its revolver borrowings to provide
greater flexibility and liquidity, although this will not be necessary to
consummate this transaction. This acquisition is consistent with our
continuing practice of monetizing non-productive assets and strategically
balancing our portfolio with new assets that can actively contribute to profit
and topline growth."
Allrecipes.com, with more than 15 million annual visitors, is the world's
largest test kitchen, offering a window into the habits of home cooks
everywhere. The site is an indispensable resource for home cooks who are
looking for trusted recipes, everyday and holiday meal ideas, practical
cooking tips, and food advice. The company is based in Seattle.
The Reader's Digest Association, Inc. is a global publisher and direct
marketer of products that inform, entertain and inspire people of all ages and
cultures around the world. The company had consolidated revenues for the
fiscal year ended June 30, 2005, of $2.4 billion. Global headquarters are
located at Pleasantville, New York. For more information, please visit
This release may include "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements inherently involve risks and uncertainties that could cause actual
future results and occurrences to differ materially from the forward-looking
statements. The Reader's Digest Association, Inc.'s filings with the
Securities and Exchange Commission, including its reports on Forms 10-K, 10-Q
and 8-K, contain a discussion of additional factors that could affect future
results and occurrences. RDA does not undertake to update any forward-looking
SOURCE The Reader's Digest Association, Inc.