Is Ancestry.com for Sale?

I just caught up with the news that the owners of Ancestry.com are in talks with investment houses for taking the company private. I pass along the article below for readers who may not have learned of this by other means. The  article appeared in the Salt Lake City Tribune a few days ago:

Buyout talk for Utah’s Ancestry.com intensifies, reports say

Deal » Suitors, deadlines surface same week as Provo company posts robust results.

Staff and news services

First Published Jul 27 2012 09:03 am • Last Updated Jul 28 2012 08:11 pm

Final bids are due next month from potential buyers for Provo-based Ancestry.com, published reports say.

The company that provides online family research tools and databases declined comment on speculation that it is discussing a possible buyout with several private equity firms.

"The way it’s trading, people think it’s a no-grow," Raghavan Sarathy, an analyst with Dougherty & Co., told the Times. "But there should be interest from private equity because they are generating copious cash."The New York Times, citing sources that it did not identify, reported earlier this week that the publicly traded company is in talks with TPG Capital, Providence Equity Partners and Permira on a possible sale.

The reports came as the company announced earlier this week that second quarter revenue rose 18 percent, to $119.1 million. Per-share profit also rose to 44 cents.

On Friday, the company’s shares closed up 72 cents to finish at $33.07 on the Nasdaq exchange. Analysts have suggested Ancestry.com could fetch more than $35 per share, Reuters reported.

Ancestry.com has been working with Frank Quattrone’s Qatalyst Partners LLC to find buyers, Bloomberg News reported last month. It already has taken first offers, Reuters said, which also did not identify its sources.

Ancestry.com CEO Tim Sullivan was asked during a conference call Wednesday about whether he could comment on a possible sale.

"No, we read the newspapers, also," Sullivan said. "We’ve seen them. I think we obviously just never would be commenting on anything like that."

Representatives for TPG, Permira and Providence each declined comment.

With stable revenue and relatively lower valuation, Ancestry.com was "attractively priced," Bank of America Corp. analysts said last month in a research report.

Ancestry.com was founded in 1983 as a publisher of genealogical books and magazines. In 1996, it became one of the first companies that recognized the power of the World Wide Web and moved operations to its website.

Private equity firm Spectrum Equity Investors LP acquired a majority stake in the parent company that runs Ancestry.com and other sites for $300 million in 2007. It took Ancestry.com public two years later in a $100 million offering.

A spokesman for Spectrum, which owned about 31 percent of Ancestry.com as of the end of March, declined to comment, Reuters said.

The company, which reported having a workforce of nearly 1,000 at the end of 2011, has more than 2 million subscribers who pay $12.95 to $34.95 a month to use its services.

The company lost almost a third of its market value earlier this year amid concerns that the cancellation of a television show featuring its genealogy research would crimp subscriber growth. "Who Do You Think You Are?" showed celebrities such as Martin Sheen and Marisa Tomei exploring their roots with the help of Ancestry.com research and gave the service more exposure. The final episode aired on May 18 on NBC.

Ancestry Wins Race to Completely Index 1940 Census

Ancestry has issued the following news release announcing that it is offering the complete index to the 1940 Census:

Ancestry.com Releases Completely Searchable 1940 U.S. Federal Census

A searchable index to 134 million records makes researching family history in the latest available U.S. Census dramatically easier

PROVO, UTAH – (August 3, 2012) – Ancestry.com, the world’s largest online family history resource, is proud to announce that it has completed the records indexing process for the 1940 U.S. Federal Census, which is available atwww.ancestry.com/1940census. All 134 million records are now easily searchable by name, date, place of birth and other key information recorded in the census. These records, which are free to search, offer valuable insight for the nearly 90 percent of Americans who either have family members recorded in the 1940 U.S. Census or are in it themselves.

Since the initial release of the 1940 U.S. Census by the National Archives in April, Ancestry.com has progressively published information from this important family history resource state by state. Ancestry.com has made this vital family history information while providing an engaging user experience including the ability to search for maiden names or other family names, often a roadblock when searching records. Additionally, users can make corrections or update information that is incomplete, leading to a better overall database of information.

Assisting in navigation of the 1940 U.S. Census is Ancestry.com’s Interactive Image Viewer, which enables users to easily peruse document pages with simple graphical overlays. The viewer adds highlights, transcriptions and other functionality directly on the Census page. This enables searchers access to small census fields by simply scrolling over them for a pop up that magnifies the information recorded by census takers.  With the ability to zoom in on individual records, these new features dramatically improve the usability of the 1940 U.S. Census, which previously only included images of the paper records. These paper records, handwritten in small entry fields, have traditionally been very hard to read, making the visual enhancements in the Interactive Viewer a huge improvement.

“We are so excited to be publishing our index to the 1940 U.S. Federal Census for free on Ancestry.com,” said Tim Sullivan, CEO of Ancestry.com. “As one of the most anticipated family history resources ever, the 1940 Census is a fantastic way for almost every American to get started making discoveries about their family history as well as a key new resource for so many of our two million existing subscribers.  Experienced through our new Interactive Image Viewer, the stories and discoveries inside the 1940 Census really come to life.”

Users can now find basic information such as their ancestors’ names and where they lived, but also gain more insight about their ancestors’ daily lives. This information includes whether they owned or rented their home, the value of the residence and how many people resided there. For the first time, census takers in 1940 also asked questions specific to income and education. Interestingly, details like prior military service, the ability to read or write, and whether citizens spoke English – all asked in prior censuses – were not asked in 1940.

The entire census can be viewed online at www.ancestry.com/1940census

Ancestry.com Inc. to Acquire Archives.com for $100 Million

The following is a blockbuster announcement from Ancestry.com:

"Simple and Affordable" Fast-Growing Start-up Adds Complementary Offering to Ancestry.com

PROVO, Utah, April 25, 2012 -- Ancestry.com Inc. (Nasdaq:ACOM) announced today it has entered into a definitive agreement to acquire Archives.com, a family history website, for approximately $100 million in cash and assumed liabilities.

This transaction will enable Ancestry.com to add a differentiated service targeted to a complementary segment of the growing family history category. In addition, Ancestry.com will welcome a team of talented engineers, digital marketers, and family history innovators into the Ancestry.com fold and also gain access to a proprietary technology platform that has supported Archives.com's rapid growth.

Archives.com is owned and operated by Inflection LLC, a Silicon Valley-based technology company. Since Archives.com's launch in January 2010, the site has rapidly grown to more than 380,000 paying subscribers who pay approximately $39.95 a year. Archives.com offers access to over 2.1 billion historical records, including birth records, obituaries, immigration and passenger lists, historical newspapers, and U.S. and U.K. Censuses.

"Archives.com has built a fantastic and fast-growing business that we think is highly complementary to Ancestry.com's online family history offering," said Tim Sullivan, President and Chief Executive Officer of Ancestry.com. "We love their focus on making family history simple and affordable, and we are excited to help the talented Archives.com team continue to grow alongside Ancestry.com, Fold3.com, and Family Tree Maker."

"Family history remains a dynamic and growing online category," added Sullivan. "Archives.com's focus is consistent with our mission to help everyone discover, preserve and share their family history, which will help continue our efforts in delivering amazing discoveries to an even broader audience."

Over the past two years, Archives.com has partnered with multiple well-known family history organizations that have helped build out Archives.com robust collection of family history records. Most recently, Archives.com partnered with the U.S. National Archives to provide free digital access to the recently released 1940 U.S. Federal Census.

"We are proud of the experience we've built with Archives.com and believe strongly in its future potential," said Matthew Monahan, CEO and Co-Founder of Inflection. "Combining with Ancestry.com positions Archives.com to best capitalize on that potential, pairing complementary visions of the marketplace and the opportunity. We've long admired Ancestry.com's content and technology and the innovations that the Ancestry.com team continues to bring to market. We're excited to see how this transaction expands the reach of family history to an even larger audience."

Upon completion of the transaction, which is subject to customary closing conditions, including expiration of the HSR waiting period, Ancestry.com will continue to operate Archives.com separately retaining its brand and website. Multiple Inflection employees, including key product and engineering executives are expected to join the Ancestry.com team.

About Ancestry.com

Ancestry.com Inc. (Nasdaq:ACOM) is the world's largest online family history resource, with more than 1.8 million paying subscribers. More than 9 billion records have been added to the site in the past 15 years. Ancestry users have created more than 34 million family trees containing approximately 4 billion profiles. In addition to its flagship site, Ancestry.com offers several localized Web sites designed to empower people to discover, preserve and share their family history.

About Archives.com

Archives.com is a leading family history website that makes discovering family history simple and affordable. The company has assembled more than 2.1 billion historical records all in a single location. Archives also partners with other leading family history websites to provide a comprehensive resource for researching your family history. Archives.com is free to try for seven days, allowing anyone to explore the benefits of membership without risk or obligation. For more information and to start discovering your family history, please visit http://www.archives.com/.

About Inflection

Inflection is a Big Data and e-commerce startup headquartered in the heart of Silicon Valley. Leveraging its proprietary technology platform, the company has built innovative data services like Archives.com, PeopleSmart.com, and Identity.com. Inflection was founded in 2006 and is backed by tier-one venture capitalists Matrix Partners and Sutter Hill Ventures.