Metacafe Traffic Dips, Acquisition May Have Stalled

The rumors around a possible Metacafe acquisition continue to swirl around silicon valley, with Yahoo or Microsoft being considered the most likely acquiror, at a $300 millionish acquisition price. Another potential acquiror is a rumored industry consortium looking to buy its way into the space. We’ve gotten confirmation from a number of potential acquirors that the company hired Lehman Brothers to shop them around, and were asking for $200-$300 million.

But we are hearing that those discussions may have stalled due to the recent release of November Comscore traffic numbers. The number of monthly unique visitors to Metacafe continues to decline from a high of 4.2 million in September, to just 3.1 million in November, a drop of approximately 25%. Total page views are relatively flat over this period, going from 97 million in September to 101 million in November.

Acquirors are also expressing concern over the relatively large percentage of “adult content” hosted by Metacafe – a profitable but difficult business to be in.