InfoSpace announced it has agreed to sell its mobile services business to Motricity, a privately held provider of mobile content services and solutions, for $135 million in cash.
"This transaction is another opportunity to unlock value for our shareholders," said Jim Voelker, chairman and CEO of InfoSpace, in a company release. "Like the previously announced sale of our online directory business for $225 million in cash, this transaction is extremely tax efficient, allowing us to capitalize on our net operating losses to significantly maximize the cash proceeds from the sale."
The company says that after completing the sale of its online directory business and its mobile business it hopes to have an excess of $550 million in cash, and then to focus its business solely on online search.
"Based on results for the first half of the year, our search business represents over 60% of InfoSpace's revenue. Our search business is highly scalable and continues to generate strong cash flow," Voelker said in a statement.
Motricity said that this deal expands its customer base to include 11 wireless carriers in North America, including AT&T and Verizon Wireless.
Both parties expect the transaction to complete within 90 days, following regulatory approvals.