Monster acquires jobsahead

Rs 40 crore deal creates Asia's largest career portal.

In a move that will create Asia's largest career portal, Monsterworldwide Inc will acquire 100 per cent of Indian job portal jobsahead.com for approximately Rs 40 crore in an all-cash deal.

The deal, which comes after a long gap in the defunct world of Internet mergers and acquisitions, involves buying out Webnueron Services that runs jobsahead.com.

According to jobsahead.com Chairman Puneet Dalmia, the deal was signed two days ago and it would take a minimum of three months to complete all regulatory proceedings.

"Jobsahead.com is the biggest competitors of monster.com in the US and the main reason for this acquisition is to cash in on the excellent revenue base of jobsahead.com. This will help us tap the Rs 80 crore online jobs market in India," Arun Tadanki, president and managing director (Asia), Monster, said at a press conference here today.

This is Monster's first acquisition in India. Though no merchant banker was involved in the deal, the US company had engaged Ernst & Young to carry out due diligence on jobsahead.com.

For the time being, monsterindia.com and jobsahead.com will run as separate entities, though in the medium term, a common team will be created to run the two websites.

Dalmia also indicated that the US company would stick to monster.com in the long run. "In the long run, it makes sense to promote one brand. For the time being we are trying to see how best to leverage jobsahead.com's brand equity," he added.

Jobsahead.com has a 40 per cent share of the online jobs market, while monster.com has another 25 per cent. "Together, we will be almost twice as large as the next player (naukri.com)," Dalmia added. The website gets around 5.5 million unique visitors every month and has 2.7 million resumes posted on it. It has close to 5,000 corporates as its clients.

The portal is among the most profitable Internet businesses in the country. It reported a turnover of Rs 15 crore and a profit of Rs 3 crore in 2003-04. Dalmia plans to double the website's turnover and profit in 2003-04.

Dalmia will continue as the chairman of the website after the acquisition has been completed and no change in the company's management team is planned.

For the investors in jobsahead.com, the deal has proved to be extremely profitable. For instance, Gaurav Dalmia, who invested in the website thrice, has made a return of 3-4 times over an average investment period of 2.5 years.