May 1st, 2007
Report: Microsoft to buy 24/7 Real Media for $1 billion
Google grabs DoubleClick. Yahoo grabs Right Media. And now Microsoft is reportedly going to take out 24/7 Real Media.
According to The New York Post, Microsoft and WPP Group are looking to buy Internet ad firm 24/7 Real Media for $1 billion, double the company's current market capitalization–at least until shares start trading Tuesday (TFSM is up 30 percent premarket).
Sources said the software giant is considering a price in the $1 billion range for 24/7 Real Media - a giant leap from the $600 million valuation analysts placed on the firm.
Microsoft, which has been kicking a lot of tires in the last few weeks, is getting serious about the ad firm after two of its fiercest rivals increased their online arsenals through similar acquisitions.
What's interesting is the valuation involved here. Microsoft's big premium for 24/7 Real Media smells a lot like fear. With Yahoo buying Right Media and Google buying DoubleClick companies like aQuantive, 24/7 Media and ValueClick are suddenly in big demand. Search giants are on the prowl and it's becoming an online advertising game of musical chairs–Microsoft doesn't want to be cut out.
Larry Dignan is Editor in Chief of ZDNet and Editorial Director of ZDNet sister site TechRepublic. See his full profile and disclosure of his industry affiliations.
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