ServiceMagic Inc. and ImproveNet, Inc., the two online marketplaces that connect consumers with prescreened residential contractors and home service professionals, announced they have entered into an agreement whereby ServiceMagic will acquire all of the outstanding stock of ImproveNet. The combination of the two companies will create the most effective, comprehensive and targeted Internet marketing solution for residential contractors. ServiceMagic has agreed to buy all of the outstanding shares and in-the-money warrants and stock options of ImproveNet for approximately $6.72 million in cash or approximately $.12 per share.
Together, the companies will offer residential contractors and home service professionals interactive services and solutions for marketing and managing their businesses online. The combined consumer bases and contractor networks are expected to drive more leads to participating contractors and improve choice for consumer members. The increased demand is projected to result in more than 165,000 consumer service requests every month to member contractors, which represents an estimated $400 million in monthly home improvement related spending by homeowners.