Google officially closes the $3.1B deal after receiving approval from European regulators
Google Inc. today said it officially closed the deal on acquiring online advertising company DoubleClick Inc. for $3.1 billion after receiving approval from European regulators.
"Although it's been nearly a year since we announced our intention to acquire DoubleClick last April, we are no less excited today about the benefits that the combination of our two companies will bring to the online advertising market," Eric Schmidt, Google's chairman and CEO, said in a blog post.
Earlier today, the European Commission gave its approval for the deal, saying the acquisition it didn't pose a significant threat to competition in the European online advertising market. However, the commission reminded the companies that they are expected to adhere to European Union legislation on the privacy of personal data, one of the grounds on which opponents lobbied to block the merger.
"We think there are significant privacy issues that have yet to be addressed," said Marc Rotenberg, executive director of the Washington-based Electronic Privacy Information Center.
"We made the case to the U.S. Federal Trade Commission and to the European competition authorities that privacy protection should be a condition of modern merger review because the privacy interests of the individuals associated with these companies are not adequately considered when the companies are combined," Rotenberg said. "We think it will be an ongoing concern particularly as the pressures and the advertising and behaviorial targeting space continue to increase and more and more data is gathered and more profiling is done on Internet mergers."
The EU's competition regulator reached its decision after a four-month investigation of the $3.1 billion acquisition, which was approved by the U.S. Federal Trade Commission in December.
Schmidt said Google had been limited by law from planning an integration strategy until it received all the necessary approvals. He said that work will now begin in earnest and the company will regularly communicate its plans for integrating the two companies to users.
The first thing Google plans to do is look at the staffing levels within the two companies and decide where to cut jobs if necessary, he said. Schmidt said that process will be completed in the U.S. by early April. When that process will be completed outside the U.S. will vary, he said.
"As with most mergers, there may be reductions in headcount," Schmidt said. "We expect these to take place in the U.S. and possibly in other regions as well. We know that DoubleClick is built on the strength of its people. For this reason we'll strive to minimize the impact of this process on all of our clients and employees."
Schmidt said the combination of Google and DoubleClick will deliver better, more relevant display ads as well as a better user experience. For one thing, users will spend less time waiting for Web pages to load, he said. In addition, Schmidt said Google is still committed to protecting user privacy.
"Ultimately, we believe that by combining our advertising network with DoubleClick's display ad serving products, and by investing resources in the display ad business, we will be able to help publishers and advertisers generate more revenue," he said. "That in turn will fuel the creation of even more rich and diverse content for Internet users everywhere."