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R.H. Donnelley to buy Business.com

R.H. Donnelley Corp., a yellow pages and online local commercial search company, has signed a definitive agreement to acquire Business.com, a business search engine, directory and pay-per-click advertising network, for $350 million in cash and deferred purchase consideration.

Through the deal, R.H. Donnelley will add the business-to-business company, whose online properties include Business.com, Work.com and the Business.com Advertising Network.

Over the past two years, R.H. Donnelley has also acquired Dex Media and its local search Web site, DexKnows.com, and LocalLaunch, a local search products, platform and fulfillment provider.

“We have been acquiring assets and building capabilities to help us take advantage of the huge opportunities that we have to leverage our brands, our content, our sales force and our servicing infrastructure to build a leading online and offline local, commercial search business,” said Dave Swanson, CEO of R.H. Donnelley.

Business.com attracts an audience of highly qualified and motivated business decision makers.

Advertisers include BusinessWeek, The Wall Street Journal, Forbes, Entrepreneur.com, Hoovers and AllBusiness.com.

Currently, Business.com optimizes the revenues from these properties through the use of its Performance Based Advertising (PBA) platform. R.H. Donnelley’s Triple Play business-to-consumer integrated marketing services will also benefit from an infusion of leading-edge search and directory technology from Business.com, particularly in the areas of performance-based advertising technologies and corresponding ad network capabilities.

“This announcement builds on our plans by bringing us a leading-destination site and a fast-growing and profitable business in the BTB online media and search vertical,” Swanson said.

Business.com employs about 100 technologists, strategists and business people. It serves more than 6,000 BTB advertisers and their agencies.

Swanson said he expects Business.com to generate revenues of greater than $50 million in 2007.

“This will allow us to improve our margins by provisioning search-engine marketing advertisers on our own sites and partner sites first, as opposed to just the major search engines,” Swanson said. “This makes us more attractive to advertisers,”

The deal is expected to close in the third quarter of this year and is subject to customary terms and closing conditions.

“Business.com is led by founder and CEO Jake Winebaum, a highly regarded, successful leader of Internet and media companies,” Swanson said. Once the transaction closes, Winebaum will be appointed president of R.H. Donnelley’s interactive unit and will report directly to Swanson.

Before Business.com, Winebaum led the Internet activities of The Walt Disney Company, serving as the chairman of Buena Vista Internet Group, which managed brands including Disney.com and ESPN.com.

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