CBS Acquires CNet
May 17, 2008 – 4:36 pm
CBS Broadcasting Inc. (CBS) is planning to acquire CNET Networks, Inc. for $11.50 a share, totalling $1.8 billion dollars. The deal should close somewhere in July.
If I were CNet, I would be slapping myself non-stop with such an offer, specially with CNet’s net income of less than $8 million a year, which makes the offer looks very generous and overpriced. Unless CBS is 
planning to do magic with CNet, they are going to cover their acquisition costs in around 19 years, I’m pretty sure shareholders won’t be happy with that. On the other hand, CNet owns some of the best domain names out there, including download.com, upload.com, news.com, search.com, com.com, tv.com, radio.com, mp3.com, chat.com, computers.com, help.com and shopper.com. These names are definitely going to add value to CBS since it’s one of the largest television and radio networks in the United States, but whether they are worth that much or not is the issue. Personally, I still think it’s overpriced.