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Disney Online Buys Kaboose Assets For $18.4 Million, Barclays Private Equity Limited Acquires Its UK Operations

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Disney Online, the online publishing business unit of Disney Interactive Media Group (DIMG), announced this morning that it has acquired a number of assets from Toronto, Canada-based firm Kaboose, in a deal worth CAD 23.3 million (approximately $18.4M). The acquisition encompasses Kaboose.com and other properties including Babyzone.com, AmazingMoms.com, Funschool.com and Zeeks.com.

The assets of Kaboose, which was founded about 10 years ago, will be integrated into Disney Online’s line-up of websites.

This network boasts, according to the press release citing comScore Media Metrix figures for February 2009, more than 27.6 million unique visitors per month, making it the No. 1 Community-Family & Parenting Web destination. Kaboose says it received nearly five million unique visitors in February 2009.

This is not the only announcement coming from Kaboose today. In a separate agreement, the company’s UK business, being Bounty Group Limited, is being sold off to a company controlled by funds managed by Barclays Private Equity Limited. The purchase price payable to Kaboose under the terms of the Bounty Transaction is approximately $97 million in cash less third-party debt outstanding on closing which is expected to be approximately $18 million.

From the press release:

Following the completion of these two transactions, Kaboose intends on distributing the resulting net proceeds to its shareholders. The Company expects that such net proceeds will result in approximately $0.65 per share being distributed to shareholders in the months following completion of the transactions, which distributions represent approximately a 70% premium to the thirty-day average closing price of Kaboose’s stock on the Toronto Stock Exchange.

Jason DeZwirek, Chairman and CEO of Kaboose, is not hiding the fact that the company was under pressure:

“2008 was a difficult year for many businesses and shareholders, and Kaboose was no exception. With the fundamental shift in the sentiment of the capital markets in general and in the media and advertising sectors in particular, and having been approached by several large international media companies and global private equity institutions interested in our business, we felt compelled to re-examine our long-term plan. With the advice of our financial advisors, the Company’s Board of Directors determined that Kaboose could divest its assets and realize significantly greater value than we could deliver as an independent public media company in the foreseeable future.”

The closing of the two transaction is conditional on obtaining Kaboose shareholder approval and other customary conditions.

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