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B. Riley Buys United Online

Internet service provider United Online Inc. is being acquired by Los Angeles investment firm B. Riley Financial Inc. in a deal valued at $170 million. The transaction comes seven months after B. Riley first made a higher offer for the Woodland Hills technology company, which was rejected. Since then United Online has been reviewing alternatives for the company, including a sale. The $11 a share B. Riley settled on in the transaction is less than the $12.50 the firm offered in November. Interim Chief Executive Jeff Goldstein said the sale was the culmination of the board looking at a range of alternatives to maximize value for the stockholders. “The transaction will allow our remaining operating business, the communications segment, to continue under B. Riley and will allow us to provide the stockholders of United Online with cash for their shares at closing,” Goldstein said in a prepared statement. The deal is expected to close by the end of the third quarter. The sale of United Online occurs at a time when the company has struggled and has been shedding its non-core businesses. In August, the company divested Classmates.com for $30 million to Intelius Holdings Inc., in Bellevue, Wash. Last month, it sold StayFriends to Ströer Content Group, a German provider out-of-home and online advertising services, and MyPoints.com to Prodege in El Segundo in an all-cash deal of $13 million. Goldstein became interim chief executive in January as the replacement for Francis Lobo, who left that position in November after two years. Shares closed down 5 cents, or a fraction of a percent, to $10.75 on the Nasdaq.

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.
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