Burda raises stake and bids for rest of Xing, 'LinkedIn of Germany'
- 26 October, 2012 15:22
German publisher Burda Digital has increased its stake in professional social network Xing to 38.89 percent, triggering a disclosure requirement and a mandatory offer to minority stakeholders. Burda is offering ¬44 per share, almost ¬7 more per share than Thursday's closing price.
"Xing is the LinkedIn of Germany," said Silke Trösch, director of corporate communications at parent company Hubert Burda Media. Xing is the biggest professional social network in Germany, Austria and Switzerland, she added.
Traditionally, Burda produced magazines and offered printing services, but since the nineties it has invested heavily in digital business, said Trösch. Last week, the company announced that 50 percent of its revenue is coming from digital offerings.
Burda also holds a stake in ElitePartner.de, a dating site for highly educated people, said Trösch. "Social communities like Xing are a very sustainable business," she said.
In the digital business, Burda has been linking e-commerce services to its magazines and websites to make money. "We have a chip publication that offers software and hardware," said Trösch. A similar e-commerce strategy could be applied to social media.
Xing had more than 12 million members worldwide in June this year and is used by professionals to find new jobs, connect with colleagues and generate business ideas. The social network was founded in Germany in 2003, has more than 50,000 specialist groups and currently employs around 520 people.
In the German speaking part of Europe, Xing has over 5.7 million members, and added 436,000 new ones in the first half of 2012.
Xing is pleased that Burda does not plan fundamental changes to its business or its bodies, said Marc-Sven Kopka, Xing's vice president of corporate communications in an email. "At this time we can say that Burda has always been a good strategic investor and will continue to uphold this stance in the future."
It remains possible that other companies may make competitive bids to Xing's minority stakeholders.
Loek is Amsterdam Correspondent and covers online privacy, intellectual property, open-source and online payment issues for the IDG News Service. Follow him on Twitter at @loekessers or email tips and comments to email@example.com