- The Washington Times - Friday, December 28, 2001

SAN JOSE, Calif. (AP) Yahoo Inc. said yesterday it would buy Internet career site HotJobs.com for $436 million after the owner of rival Monster.com decided not to sweeten its 6-month-old offer for HotJobs.
Yahoo made an unsolicited bid for HotJobs two weeks ago in hopes of wresting the No. 2 help-wanted site away from No. 1 Monster, which is owned by TMP Worldwide Inc. of New York. HotJobs said it would accept Yahoo's cash-and-stock offer unless TMP increased the all-stock bid the companies agreed upon in June.
Analysts had expected a bidding war between TMP and Yahoo, but TMP said yesterday it had offered "full and fair value" for HotJobs and would not change its terms. HotJobs will pay TMP a $15 million breakup fee and $2 million for expenses.
"We look forward to competing with HotJobs in this dynamic and growing marketplace," TMP's chairman and chief executive, Andrew McKelvey, said in a statement. A spokesman for Monster, based in Maynard, Mass., declined to comment further.
TMP's offer for HotJobs was worth about $12.20 per share at first, but TMP's stock has declined since then, making the deal worth $9.19 a share at the close of business Wednesday. Yahoo's offer values HotJobs at $10.50 per share.
HotJobs Chief Executive Dimitri Boylan predicted the alliance with Yahoo will help his help-wanted site realize its goal of toppling Monster as the leader in the $1 billion market for online job postings.
"This is going to be a very powerful combination. It should make things a lot more interesting, both domestically and internationally," he said yesterday.
Monster has important distribution deals with America Online and Microsoft's MSN network, so its leadership position appears safe, said John Corcoran, an analyst with CIBC world markets.
"HotJobs plus Yahoo will still be smaller than Monster," he said. "I wouldn't call it a big blow to Monster, by any means."
Yahoo hasn't determined whether it will lay off any of HotJobs' 525 workers , Mr. Boylan said.
He said he hopes HotJobs' brand, established in 1997, will continue under Yahoo's ownership. The company still plans to run television advertisements during the Super Bowl Feb. 3 as will Monster.
With revenue expected to fall 37 percent this year, Yahoo is hunting for new ways of making money beyond advertising. New York-based HotJobs charges employers and recruiters to post job openings and to access its database of resumes. It also sells software that helps manage corporate human resource operations.
HotJobs' database of 5 million resumes trails Monster's 14 million, and HotJobs lost $21.2 million in the first nine months of the year.
But Yahoo says it believes HotJobs is in good position to take advantage of the expected surge in online job postings and recruitment as the economy recovers. Analysts expect HotJobs' revenue to rise 12 percent next year, better than Yahoo's expected growth of 5 percent, according to Thomson Financial/First Call.
The HotJobs acquisition also should give Yahoo deeper packages of services to offer to companies, a key part of chief executive Terry Semel's strategy.
"It was an interesting and a bold move by Yahoo, and it paid off," Mr. Corcoran said. "A year from now, you may look back and say Yahoo was able to buy HotJobs at the dip."
Shares of HotJobs fell 30 cents, nearly 3 percent, to close at $10.37 yesterday on Nasdaq. Yahoo shares rose 26 cents to $17.77, and TMP moved up $1.85, more than 4 percent, to $43.73.

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