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j2 Global Expands Digital Business

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Unified messaging service provider j2 Global Inc. (JCOM - Free Report) announced that its subsidiary Ziff Davis Inc. has acquired IGN Entertainment website from media giant News Corporation (NWSA - Free Report) . The acquisition is expected to increase j2 Global’s digital media business by more than two fold.

IGN Entertainment’s asset includes,, and and is a leader in video game, entertainment and men’s lifestyle content. Additionally, the company boasts more than 600 advertisers and 53 million unique global customers.

j2 Global possess a global network of publishing partners and delivers local content in 10 languages across 40 different countries. The combination of Ziff Davis’ popular assets and its strength in data analytics with IGN’s powerful video content business will make j2 Global one of the largest digital publishers in the lifestyle and entertainment space.

Delaware-based j2 Global believes that the combined portfolio of assets will create a very powerful content producing company and thereby allowing its marketers to address a larger group of audience. Although, the company hasn’t declared the financial terms of the deal, it is believed that News Corporation is offloading its assets at a much lower price than $650 million it spent to acquire IGN in 2005. j2 Global expects the acquisition to contribute in its 2013 earnings.

In November last year, j2 Global acquired privately-held digital media company, Ziff Davis Inc. for a total consideration of about $167 million. We believe the acquisition is a strategic move by the company to target the young tech-friendly customers, who are using their smartphones more often to download video games and order online lifestyle products.

Financial Results of Related Companies

Websence Inc. , another operator in the industry, has declared weak financial results for the fourth quarter of 2012, with adjusted earnings of 13 cents, way below the Zacks Consensus Estimate of 25 cents while Open text Corporation’s (OTEX - Free Report) second quarter 2013 earnings of $1.53 per share breezed past the Zacks Consensus Estimate of $1.34.

j2 Global currently carries a Zacks Rank #3 (Hold).

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