The confusing saga that is CitySearch Inc’s corporate plans has now come to a conclusion, with the announcement that it is being bought by the Ticketmaster Online unit of USA Networks Inc in a deal reportedly worth $260m. CitySearch has thus terminated its plans for a $50m initial public offering this week, but the combined entity – to be called Ticketmaster Online-CitySearch will file to go public at some point in the near future. Although the operations will be combined, the companies say their separate identities will be preserved on the web. USA Networks already owns 12% of CitySearch and will own 62.5% of the combined entity, with CitySearch holding the rest. The new company will have a capitalization of $700m, according to reports. USA Networks has also invested $50m in the new entity to fund its development, in the form of a convertible debt security. The acquisition is expected to close this quarter. Prior to the announcement of its IPO, CitySearch announced that it was acquiring local content aggregator Zip2 Corp for about $300m. But that deal was called off a month later after the two decided that there was too many differences in their respective businesses. Although Ticketmaster is essentially buying CitySearch, Charles Conn, the CEO of CitySearch, will become the new entity’s CEO, while Alan Citron, president of USA Networks will become the chairman. The pair say there will be no job cuts as a result of the deal – CitySearch apparently employs 550 people. CitySearch operates city web guides in 12 US cities, two in Australia and one in Canada, and plans to add some bizarre new ones in the coming months: along with Baltimore, San Diego and Dallas-Fort Worth, look out for Copenhagen and Stockholm, but no London, Paris, Berlin or Madrid yet, which would seem to be more obvious choices, but we presume it depends on what partnerships the company can strike with local media. Ticketmaster Online sells tickets to more than 25,000 local events across the US and the new entity will maintain its relationships with the 37,000 physical outlets across the country. CitySearch has been facing increasing competition recently, most notably from America Online’s Digital Cities and Microsoft Corp’s Sidewalk. In addition to Ticketmaster, which it acquired in June, USA Networks also owns the USA Network, Sci-Fi Channel, Studios USA and Home Shopping Network, among others. Ticketmaster was founded by Paul Allen, who sold his interest to Home Shopping Network last year.
