NEW YORK (CNN/Money) -
MarketWatch, the owner of the financial news Web site CBS MarketWatch, is soliciting bidders and could sell for as much as $400 million, according to a published report.
The New York Times reported Thursday that MarketWatch quietly put itself on the market early in September. The $400 million price tag would be about 14 percent above the company's stock market worth of roughly $350 million, including Wednesday's gains.
Viacom (Research) unit CBS Enterprises and British media company Pearson (Research) each own 22.4 percent of the outstanding shares of MarketWatch. Pearson owns the Financial Times.
The newspaper said bidders could include both Viacom and Pearson as well as the New York Times Co. (Research). Other potential bidders include Dow Jones Co. (Research), owner of the Wall Street Journal, and Web portal and search engine Yahoo! (Research)
The paper said the company hired UBS to conduct the auction and that final bids are due next week.
A spokesman for MarketWatch said the company would not verify that the company is for sale nor would it comment on the report in the Times.
Shares of MarketWatch (up $0.19 to $13.90, Research) jumped about 2 percent on the news to trade near $14, close to the consensus 12-month target price of analysts, according to First Call.
Sale would boost company
"We're obviously happy about a sale," said John Tinker, a star analyst at ThinkEquity Partners who covers MarketWatch. "We raised our price target to $16 a share from $14."
Tinker said the company has reached a point where it must be sold. "They're the No. 4 ranked financial Web site, they lived through the bubble, so we know they're tough. They don't need CBS, but they do need a real partner who can help them expand," he said.
Even though the company has made no noise about expanding to cover areas outside financial news, Tinker said their deal with CBS states they can only cover financial news, curbing future opportunities. He added that MarketWatch is growing, ramping up their number of financial journalists to 120 from 100.
MarketWatch has weathered more than the tech collapse, successfully dealing with an informal inquiry launched by the Securities Exchange Commission of a former chief commentator, Thom Calandra.
Calandra, who was also the founder of MarketWatch's parent company MarketWatch.com Inc., resigned shortly after the inquiry was announced. While there have been no new developments since early in the year, MarketWatch began conducting its own internal investigation into whether Calandra violated the company's trading and disclosure policies.
The company on Wednesday reported third-quarter earnings of 4 cents a share, topping analysts' average forecast for a break-even quarters. But it gave fourth-quarter guidance of about 15 cents a share, less than the consensus forecast of 16 cents, according to First Call.
Analysts cut their consensus forecast to an average of 12 cents following the report.
CNN/Money, a unit of Time Warner Co. (Research), is a competitor of MarketWatch.
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