Google paid $151M for Zagat in flurry of 3Q deals
Thursday, October 27, 2011
SAN FRANCISCO (AP) — Google spent more than $500 million to acquire another 27 companies during the third quarter, ensuring this year will be busiest shopping spree in the Internet search leader’s history.
The tally emerged Wednesday in a quarterly report that included another previously undisclosed nugget: Google Inc. paid $151 million in cash for the Zagat Survey, a renowned restaurant review publisher that Google bought to counter the popularity of Yelp’s business rating service. The price is higher than estimated in previously published reports, which pegged the deal’s value between $65 million and $125 million.
Google’s latest flurry of deals raised its acquisition count to 57 companies through the first nine months of the year. That already exceeds Google’s previous annual record of 48 acquisitions, reached last year.
Although Google has never completed more acquisitions in its 13-year history, the company isn’t guaranteed of setting a new spending record.
Through September, Google’s deals had cost a total of $1.4 billion. That’s below the $1.8 billion that Google spent last year and less than the $3.2 billion it spent in 2008 buying online advertising service DoubleClick, its biggest-ever purchase and its only acquisition that year.
Google agreed to buy cell phone maker for Motorola Mobility Inc. for $12.5 billion in August, but that deal may not be completed before the end of the year. That’s because the U.S. Justice Department is investigating whether the proposed takeover would stifle competition in the increasingly important mobile phone market.
Most of Google’s acquisitions involve small startups that are developing promising technology or employ talented engineers.
Google snapped up the Zagat Survey because it wanted a well-known brand that would allow it to feature more restaurant recommendations and reviews on its own website instead of sending Web surfers to Yelp and other rivals.
Google tried to buy Yelp in 2009, only to be rebuffed. Yelp is now among a group of competitors trying to convince U.S. regulators that Google has abused its dominance of Internet search by highlighting its own services in its results.
After Zagat, the next-largest acquisition Google completed in the third quarter was the $114 million purchase of Daily Deals, an online discount service in Europe.
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