October 29, 2018 / 8:54 AM / 19 days ago

Germany's ProSieben buys U.S. online dating site eharmony

FRANKFURT/MUNICH (Reuters) - Germany’s ProSiebenSat.1 Media said on Monday it had bought U.S. online dating site eharmony, in the first significant deal since it carved out a new e-commerce joint venture with General Atlantic.

The logo of Germany's biggest commercial broadcaster ProSiebenSat.1 Media AG is pictured in front of their headquarters in Unterfoehring, near Munich, Germany in this February 26, 2014 file photo. REUTERS/Michaela Rehle

The acquisition of eharmony, which was founded in 2000 in Los Angeles and expects to register 2.8 million new users this year, complements ProSieben’s own Parship dating franchise which is the market leader in Germany.

“We are bringing together two strong brands and will build them into one of the world’s leading online dating businesses,” ProSieben CEO Max Conze said in a statement.

Terms were not disclosed for the deal to buy eharmony, which was founded by clinical psychologist Neil Clark Warren and uses an extensive online questionnaire to determine the compatibility of potential couples seeking long-term relationships.

Parship and sister brand ElitePartner, which count 2 million registrations a year, use an algorithm that was developed separately in Germany but that is based on a similar approach, said Claas van Delden, co-CEO of Nucom.

“They are based on the same conviction,” van Delden said. “In addition the takeover is so attractive because eharmony has a brand awareness of nearly 90 percent and a very big user base that we can serve better from a common platform.”

The transaction follows through on ProSieben’s push to diversify away from its core commercial TV franchise, where ad revenues are flat and the sector is being disrupted by streaming platforms like Netflix.

The Munich-based broadcaster bought eharmony via its newly created Nucom division, in which investor General Atlantic took a 24.9 percent stake in February. Nucom in turn owns 94 percent of Parship.

It said the deal would open access not only to the online dating markets in the United States, but also in Canada and Australia where eharmony is also present. The U.S. market is the most richly valued on a per-user basis and is worth $3 billion, ProSieben said, citing independent research.

Privately held eharmony has raised a total of $113 million in two funding rounds, the most recent being in 2004, when it was backed by Tuputele Ventures, TCV, Sequoia Capital and Fayez Sarofim & Co, according to Crunchbase.

Eharmony CEO Grant Langston will continue to run the business while representatives of Parship will join its board.

Reporting by Douglas Busvine and Joern Poltz; Editing by Maria Sheahan

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