NEW YORK (Reuters) - More deals could follow Monster Worldwide Inc’s MWW.N planned purchase of Yahoo Inc’s YHOO.O HotJobs, as both online and traditional recruiters see an opportunity to accelerate growth in an improving economy, a rival said on Thursday.
“Consolidation is an opportunity,” Scot Melland, Chief Executive of Dice Holdings Inc (DHX.N), told Reuters. He cited growing confidence that the U.S. labor market is getting stronger. Friday’s U.S. employment report is expected to show only the second monthly jobs gain since 2007. <ECI/US>.
Dice runs specialized sites focused on technology jobs and finance career jobs.
Monster said Wednesday it would pay $225 million in cash for the smaller jobs site, while entering a multiyear traffic deal to be the exclusive career site on Yahoo’s U.S. and Canadian home pages.
Monster shares fell amid concerns about rising expenses.
Melland called the deal a win for both Monster and Yahoo and said Monster was not likely to face antitrust obstacles.
“I don’t expect them to have a problem in terms of antitrust because this really is a fragmented industry,” he said. “The number of online recruiters is literally thousands, (though) only about five to 10 have any sort of scale.”
The deal would vault Monster over CareerBuilder in terms of visitors to Internet jobs sites, where the two market leaders each control an estimated one-third of the market, according to comScore data. HotJobs’ share has slipped to about 17 percent, according to Wells Fargo Securities.
Online recruitment also includes players like Dice, as well as TheLadders.com and Simply Hired Inc. Companies in the sector face competition from sites such as craiglist.com and social-network companies like LinkedIn and Facebook.
Dice’s Melland said he does not expect much impact on his company’s business because Dice’s specialized sites are geared more for passive job seekers who are currently employed, rather than the active job seekers who log into HotJobs, Monster and CareerBuilder sites.
More deals could be coming.
“We saw the same flurry of merger and acquisition activity when we came out of the last recession,” Melland said. “As soon as the economy improves, that’s when you see companies become confident enough in their own business that they’re now looking at strategic opportunities.”
Asked whether Monster or another company has approached Dice about doing a deal, Melland said: “I can’t speak about those types of conversations.”
Outside the online recruitment business, traditional staffing companies have stepped up dealmaking in recent weeks.
Manpower Inc (MAN.N) said it would buy technology staffing company Comsys IT Partners Inc for about $431 million.
Rival Spherion Corp SFN.N said Monday it would buy Tatum LLC, a provider of interim executives.
And Swiss-based Adecco ADEN.VX last month completed its acquisition of professional staffing services company MPS Group Inc.
Editing by Gerald E. McCormick