CBS Agrees to Buy CNET for $1.8 Bil.

CBS has struck a deal to buy CNET Networks for $1.8 billion in cash.
The deal represents CBS’ biggest move yet to become a major player in online advertising. It would add to the company one of the most highly trafficked collection of Web properties, including the tech-focused and ZDNet, gaming site GameSpot, music destination and a collection of venues in entertainment and information.
CBS said it would combine those assets with its existing Internet properties, which would make the company one of the top 10 U.S. Web firms with 54 million monthly users.

CBS has been assiduously building its Web presence over the past 18 months, since bringing in Silicon Valley dealmaker Quincy Smith to lead its strategy. In addition to CBS-branded Web sites, it has launched a content and ad network of 300 sites. CBS has also made several smaller acquisitions, such as finance video blog Wallstrip, high-school sports destination and music discovery site
“Together we will have a terrific opportunity to not only grow our established businesses, but to build new attractive verticals of content as well,” Smith said in a statement. “This is the beginning of an era for both CBS and CNET Networks.”
CNET was one of the largest remaining independent content properties. It reported revenue of $405 million in 2007, but it has seen traffic to some of its tech sites eclipsed by the rise of blogs. Former company executives also were ensnared in an options-backdating investigation in 2006. CNET CEO and founder Shelby Bonnie stepped down in late ’06 on account of the probe.
CNET’s board unanimously approved the deal, which will pay the company $11.50 per share. CBS expects the transaction to close in the third quarter. The bid represents a 45 percent premium above CNET’s closing share price of $7.95 on Wednesday.

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