Tuesday, June 14, 2005

CORRECTED: Gupta Wants to Take InfoUSA All Private

[We originally put this out on 14 June with the headline "OneSource Goes Completely Private, Sealing a Successful Deal " and a link to an Information Today story on the InfoUSA/OneSource deal that ran in May of last year: our apologies for the error, a corrected version runs below with the correct citation and commentary regarding yesterday's news report of InfoUSA's plans to go altogether private.]

As reported by DM News, Vin Gupta & Co. LLC, controlled by InfoUSA chairman/CEO Vin Gupta is proposing to acquire the rest of InfoUSA's shares and to take the company private. This comes on the heels of a revised earnings report by InfoUSA to account for weakness in Donnelly Marketing and small business revenues, while its subsidiary OneSource Information Services reports strong growth. Why go private now? InfoUSA has had good success in encouraging more profitable and efficient operations in its new OneSource subsidiary, encouraging new thinking about operations and using its own data sources effectively in OneSource's business information databases: Gupta's dedication to squeezing out costs from data acquisition, quality control and management is legendary. But efficiencies can't always overcome markets that are weakening. Even as the demand for integrated solutions such as OneSource's business information services strengthens, direct marketing through spam-plagued email and more traditional mass-marketing media and communications channels are facing uphill battles to get noticed by audiences turning to online resources for answers. At the same time contextual ads and online sales lead generation services that bypass firehose-scaled techniques to focus on specific "right now" prospects for products and services are making online outlets a very powerful way to build relationships with potential clients online very cost-effectively. With marketeers infatuated with making the most of these online resources, especially smaller businesses that have found a more level playing field for getting out their message through contextual ads, it's no small wonder that InfoUSA may want to consider how to reposition its powerful marketing databases for the long run in less of a public glare. If this comes to fruition, and there's no reason to think that it won't, don't expect that it will be the last of InfoUSA stock. A little privacy just might give InfoUSA a chance to tidy up its strategy and resources to the point where a new curtain will rise for public investors to consider down the road.
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