Ancestry.com just bought Archives.com.
Well, Ancestry.com announced their intention to acquire Archives.com, subject to customary closing conditions, including expiration of the HSR waiting period
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Archives.com was founded in 2010, and only two years later, Ancestry.com pays $ 100 million for it. Archives.com is still owned by Inflection. Inflection also owns PeopleSmart.com and the still to be introduced Identity.com. These services are not being sold sold to Ancestry.com. The deal is for Archives.com only.
Ancestry.com went public in 2009.
The went public at US$ 13,50 share for 7.407.407 shares of common stock - that is approximately US$ 100 million.
Ancestry.com now intends to acquire Archives.com for approximately $100 million in cash and assumed liabilities.
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Simply put, they are spending as much on Archives.com as their IPO yielded.
That is far from the full financial picture, but it underscores that Archives.com isn't a minor acquisition.
Several major developments since the IPO are discussed in the 2010 Sep 23 Ancestry.com Buying Spree;
the introduction of Mundia.com, the acquisition of Genline.se, the acquisition of ProGenealogists
after shutting down their own Expert Connection service, and the acquisition of iArchives,
the parent company of Footnote.com.
Since that article was published, my prediction that MyHeritage may buy the remains of FamilyLink née WorldVitalRecords has come to pass.
MyHeritage buys BackupMyTree and MyHeritage buys FamilyLink discuss
how MyHeritage continues to grow through acquisitions, as first noted in MyHeritage growing through Acquisitions.
It is remarkable how different the Ancestry.com and MyHeritage acquisitions strategies are.
Many of MyHeritage's acquisitions were small, failing companies they could snap up for little money.
Their biggest acquisition is the remains of FamilyLink née WorldVitalRecords, and back in 2010 FamilyLink was already selling and closing down many of its assets.
In at least one case, the PR value of the acquisition exceeded the acquisition cost.
Do not think that all their acquisitions are without strategic value.
Their first acquisition, Pearl Street Software, got them Pearl Street's SmartMatching technology,
and the relatively recent acquisition of the remains of FamilyLink gives this Israeli company a clear presence in the U.S.A., and MyHeritage seems eager to expand this foothold, and take on Ancestry.com on its home country.
Ancestry.com has been buying successful companies for strategic reasons. The acquisition of Genline.se made them a dominant player in Sweden. The abolition of the Expert Connect programme and the acquisition of ProGenealogists made Ancestry.com a major player in the professional genealogy services market. The acquisition of iArchives not only gave them Footnote's Interactive [American] Census Project, it also got them iArchives' digitisation technology, image viewing software, and partnership deals.
Ancestry.com is an international company with offices in multiple countries, but is now facing competition on its home turf. Ancestry.com has Mundia as an alternative to the online trees that MyHeritage.com and Geni.com offer, but consumers do not buy Ancestry.com subscriptions to access the online trees. Consumers buy Ancestry.com subscriptions for access to Ancestry.com's records collections. Ancestry.com seems to have the American original records market cornered; whether their current stranglehold on this market constitutes a monopoly is hardly a matter of debate; practically every American genealogists agrees that you need an Ancestry.com subscription. However, the consumer view and the financial market view are not the same.
Many American genealogists find Ancestry.com's subscription fee too much,
and this is reflected in the high turnover and acquisition costs of subscribers.
According to Ancestry.com-sponsored bloggers, an Ancestry.com subscription isn't expensive at all,
but the American genealogy record subscription business sure is profitable, and other players want a slice of the pie.
FamilyLink née WorldVitalRecords was floundering, but provided MyHeritage a cheap entry into this lucrative market.
Brightsolid, the parent company of findmypast, entered the American market with censusrecords.com.
Last but not least, in just two years, Archives.com built a presence Ancestry.com could not ignore.
The acquisition will certainly effect the genealogical market. Ancestry.com has made it clear that Archives.com will be maintained as a distinct brand and subscription. The Ancestry.com blog and press release are already hinting at the new brand strategy where Ancestry.com is the premium brand, and Archives.com is the entry-level brand.
A prevalent sentiment among genealogists is that Ancestry is dominating the market by buying the competition.
Ancestry.com seems very eager to contradict that sentiment.
Their blog post announcing the acquisition already claims that there There have never been more products and services available to genealogists than there are today
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At the same time, their press release clearly states that the deals is subject to customary closing conditions, including expiration of the HSR waiting period
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The Hart–Scott–Rodino Act is an American anti-trust law.
Before certain mergers and acquisitions, the parties involved must file some paperwork
with regulatory agencies, which then determine whether the proposed transaction violates anti-trust laws or not.
It sometimes seems that Ancestry.com is already monopoly, but there is a healthy amount of industry competition. FamilyLink née WorldVitalRecords isn't gone, it is owned by MyHeritage now, and with MyHeritage funding, it is in a better position to compete than before. Footnote no longer competes with Ancestry.com, but former Footnote executes recently joined MyHeritage. Brightsolid entered the American market with censusrecords.com, and there is a new company called RootsPoints that is also hoping to attract customers with the USA 1940 Census.
The USA 1940 Census seems to play a central role in the acquisition and the valuation of Archives.com.
Archives.com managed to get the NARA contract to host the USA 1940 Census, and that led to a considerable amount of press.
To American genealogists, the USA census is a big deal, and the release of a census is a boost for the genealogical market.
Archives.com got the government contract, so Archives.com, not Ancestry.com, was at the centre of it all.
The price Ancestry.com is paying for Archives.com seems high, but the acquisition does put Ancestry.com back in the centre of attention,
and makes them the owner of Archives.com's government contracts.
The acquisition of Archives.com gets Ancestry.com a second index for the USA 1940 Census. They can use this to create a double double index, and that's definitely good news for genealogists.
Ancestry.com has bought GeneTree. See Ancestry.com introduces AncestryDNA.
The acquistion of Archives.com has completed.
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