Homestore.com Sells Credit Reporting Division to Experian for $130MEmbattled real estate portal Homestore.com said yesterday that it signed a definitive agreement to sell its consumer credit reporting division ConsumerInfo.com to database marketer Experian for $130 million in cash.
The deal, which is expected to close in April, is subject to regulatory clearance.
Homestore.com's ConsumerInfo.com division provides consumers with access to their credit histories, scores and related information. The company claims it is the first to provide consumers with online access to their credit histories.
The company said it sold ConsumerInfo.com because the division no longer fits with its goal of focusing on its core real estate products and services business.
The real estate portal said in late February that because of accounting errors it overstated advertising revenue from January to September 2001 by $76 million to $82 million and that it would restate its earnings for the first nine months of the year. It also said recently it reduced its revenue for 2000 by $41.4 million. An internal audit found that Homestore.com overstated non-advertising revenue by $28 million to $31 million for the first three quarters of 2001.
The company said ConsumerInfo.com derives much of its revenue from membership subscriptions. It charges $79.95 a year for unlimited access to credit reports. It also sells individual reports, credit scores and other services for prices ranging from $9.95 to $44.95.
Experian said the acquisition of ConsumerInfo.com fits nicely with its planned expansion of its direct-to-consumer marketing.
"This acquisition is an opportunity to expand significantly our reach into the direct-to-consumer market, a major growth strategy for Experian North America," said Don Robert, Experian's chief operating officer.
In August, Experian launched CreditExpert.com, a Web site where consumers can register to receive personal credit reports and credit scores and access credit management and monitoring services. The portal is a joint venture of Experian and Encore Marketing International Inc., a membership marketing firm. The two have set up a company called Credit Expert LLC to manage the CreditExpert.com portal.
Through the portal, Experian offers subscriptions to its Credit Manager service, which features credit report, credit score tools and use analysis. The service also offers instant e-mail notifications when changes are made to a member's credit report. Annual subscriptions to Credit Manager are $79.