IAC exploring spinoff of home improvement marketplace Angi

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IAC exploring spinoff of home improvement marketplace Angi

 

Pavlo Gonchar | SOPA Images | Lightrocket | Getty Images

IAC said Monday it’s exploring a spinoff of Angi, an online platform that connects consumers with a marketplace of home improvement service providers in their area, like electricians and landscapers.

Angi stock price was down nearly 2% in after-hours trading on Monday. IAC shares also fell 1% in extended trading.

The company is considering a spinoff of Angi that would result in its stake being distributed to shareholders, IAC CEO Joey Levin wrote in a letter to shareholders that coincided with the company’s third-quarter earnings release. IAC owns 85% of Angi,

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home services marketplaces Handy and HomeAdvisor.

IAC said there’s no specific timeline for when the spinoff will take place, but if it decides to move forward with the plan, a transaction is expected to happen by the end of the company’s second quarter.

“With the considerable progress made and developments on the horizon, we have real upside in the business,” Levin wrote. “Angi’s economic foundation continues to strengthen, and we suspect that Angi’s best shot at realizing that upside to the benefit of our shareholders may be as a standalone company.”

Levin went on to say that Angi is “healthy, profitable and on a path to resume revenue growth.” The company’s revenue declined 16% year over year to $296.7 million during the third quarter, which Angi attributed to lower sales and marketing spend, which led to a decrease in service requests and lower acquisition of new professionals.

IAC acquired Angi in 2017, and it’s been weighing a spinoff of the business for several years. The company postponed the effort in 2019 as it completed the spinoff of Match Group, which owns dating services including Tinder, Match and Hinge.

IAC has become known for incubating businesses and spinning them off into separate companies. It’s done the same with Expedia, Ticketmaster and LendingTree, among others.

In IAC’s earnings release, the company also broke out results from its Care.com segment for the first time. IAC in 2019 acquired Care.com, an online marketplace for consumers to find childcare, senior care, **** care and other services, for nearly $500 million.

Care.com revenue declined 6% year over year to $95.7 million during the third quarter. In the last 12 months, Care.com generated adjusted EBITDA of $46 million.

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#IAC #exploring #spinoff #home #improvement #marketplace #Angi

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