IAC/InterActiveCorp has announced an agreement to acquire ServiceMagic Inc., an online home services marketplace, in a cash transaction. Terms of the agreement were not disclosed. ServiceMagic will remain an independent brand within the IAC Local and Media Services Group.

ServiceMagic, founded in 1999, connects homeowners with prescreened and customer-rated residential contractors, real estate professionals, and lenders. According to the company, nearly 50,000 service professionals utilize ServiceMagic to find targeted leads for home building, remodeling, architectural services, roofing, fences, decks, painting, flooring, plumbing, and more.

Anne Busquet, CEO of IAC Local and Media Services, said, "The migration of local advertising from offline to online has tremendous growth potential and is applicable to hundreds of industries, but has been realized by only a few. ServiceMagic has created a highly scalable system that provides consumers convenience, confidence, and choice in purchasing home-related services while driving down marketing costs for local service businesses via targeted advertising.

"The IAC Local and Media Services Group was formed to provide consumers with information, ratings, advice, connections, and access wherever they are and wherever they are going so they can make well-informed decisions. We are pleased that ServiceMagic will join Citysearch, Evite, Entertainment Publications Inc., and TripAdvisor as part of our mission to efficiently connect merchants with the millions of consumers who want their services."

Upon closing of the acquisition, management of ServiceMagic's lending and real estate businesses will fall under the IAC Financial Services and Real Estate Group.

ServiceMagic co-CEO and co-founder Michael Beaudoin said, "We launched ServiceMagic with the belief that there was a better way to connect homeowners with quality, reputable service professionals. IAC's extensive consumer reach and merchant relationships give us the opportunity to significantly accelerate our mission to revolutionize how people buy and sell local services and to expand to the many other business arenas that can benefit from our efficient customer acquisition platform."

Publication date: 08/16/2004