updated: 8/13/2001 3:23:00 PM
Shares of Hungry Minds closed Friday at $6.90 on the Nasdaq Stock Market.
The stock has been on a downard spiral since 1999, when it hit a high of about $25 a share. A year ago, IDG Books Worldwide, Inc. announced the acquisition of Web site, Hungry Minds, in an effort order to accelerate IDGB's online knowledge offerings. Later, IDG Books changed its name to Hungry Minds. Apparently, the strategy did not work and the company. In May 2001, the company reached an agreement with its lenders to take all steps necessary to move forward with the sale of the Company by July 31, 2001.
John Kilcullen, Chairman and CEO of Hungry Minds, said, "Over the last eleven years, we have built the leading portfolio of knowledge brands in the publishing industry. John Wiley & Sons, Inc. is a company whose longstanding and distinguished publishing tradition makes it an ideal home for our brands, customers, employees and all business partners."
"The long-term value of Hungry Minds' world-renowned brands makes this a unique opportunity to build on our proven track record with acquisitions and exploit our strong global position," said William J. Pesce, President and Chief Executive Officer, John Wiley & Sons, Inc. "The acquisition of HMIN is an excellent opportunity to accelerate Wiley's revenue and earnings growth and enhance our competitive position in the professional/trade market," he continued. On a cash EPS basis the acquisition is estimated to be neutral in the current fiscal year and accretive thereafter.
Hungry Minds will report a net loss for the third fiscal quarter, 2001 of $0.9 million, or ($0.06) per share, versus net income of $2.6 million or $0.17 per share for the same period prior fiscal year. Net revenues for fiscal third quarter ending June 30, 2001 are $41.4 million, down 25% from $55.2 million in the fiscal third quarter of 2000; EBITDA is $4.0 million, down from $7.8 million for fiscal third quarter, 2000, a 49% decline. Hungry Minds will file its 10Q third quarter this Tuesday, August 14.
John Wiley will commence the cash tender offer within five business days. The offer will remain open for 20 business days, unless extended pursuant to the merger agreement. The offer is conditioned, among other things, upon a majority of the issued and outstanding shares of Hungry Minds, on a fully diluted basis, being validly tendered and not withdrawn prior to the expiration of the offer, other customary conditions and customary regulatory approvals. The tender offer is not subject to a financing contingency.
The Board of Directors of Hungry Minds has unanimously approved the tender offer and the merger and has recommended that Hungry Minds shareholders tender their shares in the offer. In addition, International Data Group, the majority shareholder of Hungry Minds, has entered into an agreement under which it has agreed to tender all of its shares into the John Wiley tender offer.
About John Wiley & Sons, Inc.
Founded in 1807, John Wiley & Sons, Inc., provides must-have content and services to customers worldwide. Our core businesses include scientific, technical, and medical journals, encyclopedias, books, and online products and services; professional and consumer books and subscription services; and educational materials for undergraduate and graduate students and lifelong learners. Wiley has publishing, marketing, and distribution centers in the United States, Canada, Europe, Asia, and Australia. The company is listed on the New York Stock Exchange under the symbols JWa and JWb. Wiley's recently relaunched Internet site can be accessed at www.wiley.com.
About Hungry Minds, Inc.
Hungry Minds, Inc. (Nasdaq: HMIN) is a leading global knowledge company with a diverse portfolio of technology, business, consumer and how-to brands, computer-based learning tools, Web-based products and Internet e-services. Hungry Minds' best-selling brands include For Dummies, Betty Crocker, Bible, CliffsNotes, Frommer's, the Unofficial Guide, Visual, Weight Watchers and Webster's New World. Hungry Minds is also the official publisher of AOL Press, Hewlett Packard Press, Netscape Press, Novell Press and Red Hat Linux. Hungry Minds has over 2,500 active titles and licenses in 39 languages around the world. Hungry Minds also owns the Web sites www.cliffsnotes.com, www.dummies.com and www.frommers.com. More information about Hungry Minds is available from the company's SEC filings or by visiting their corporate Web site at www.hungryminds.com.
(c) 2001 Hungry Minds, Inc. All rights reserved. Hungry Minds and For Dummies are trademarks or registered trademarks of Hungry Minds. Frommer's is a trademark or registered trademark of Arthur Frommer used under exclusive license. All other trademarks are property of their respective owners.
Investors and security holders are strongly advised to read both the tender offer statement and the solicitation/recommendation statement regarding the tender offer referred to in this press release, when they become available, because they will contain important information. The tender offer statement will be filed by Wiley with the SEC, and the solicitation/recommendation statement will be filed by HMIN with the SEC. Investors and security holders may obtain a free copy of these statements (when available) and other documents filed by Wiley and HMIN at the SEC's web site at www.sec.gov.