Amazon buys Goodreads, but for how much?
Bloomberg pegs the deal at close to $1 billion, while the AllThingsD site estimates it as $200 million at most.
Bloomberg Businessweek estimates that Amazon paid "close to, but not quite, $1 billion" for the site while Kara Swisher of the AllThingsD blog pegs the acquisition price at about $150 million, or up to $200 million when factoring in potential incentive payments.
Seeing such a huge difference in price of a potential deal is strange considering that news about mergers and acquisitions often is leaked with the precision of a Swiss watch. Media sites rarely differ much on the price.
The Businessweek article is speculative, basing the Goodreads price on the value of LinkedIn (LNKD), a publicly traded company with 202 million active accounts valued by investors at $95 per user. Based on recent financing rounds, Facebook's (FB) running value is $58 per user, while Pinterest and Twitter are valued at about $50 a head, the article says.
"Working with that range, Goodreads’ 16 million users at $55 each would add up to a sticker price of $880 million," Businessweek says. "Of course, that’s an overly simple, back-of-the-envelope estimate. Any decent I-banker would try to push that valuation on two fronts: the growth rate of the network and its potential for monetization."
Swisher, a veteran tech journalist, sees things much differently, saying the Businessweek figure is simply wrong. "I did actual reporting with seven excellent sources," she told MSN Money in an email. She said she wasn't sure how much of the deal was in cash and stock, though her sources say most of it was cash.
Amazon, the largest e-commerce company, didn't disclose the price and couldn't be reached for comment. Efforts to reach Kyle Stock, the Businessweek reporter who wrote the article, were unsuccessful.
--Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr
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