After almost four months of negotiations with AOL, Digital Sky Technologies announced on 28 April they have reached a deal with the online to giant acquire ICQ for USD 187.5 million. As the leader in instant messaging in Russia, ICQ represents an opportunity for DST to strengthen its market position by providing a large new customer base for companies already in the DST portfolio.
For its part, AOL is shifting away from the subscription-based model toward a digital media and advertising model.
Originally created in 1996 by Israeli company Mirabilis, ICQ was focused on meeting a growing need to link Windows-based computers in various locations around the globe. The company’s instant messaging service quickly grew to be the dominant market player until competitors like Yahoo! and MSN reduced its market share. Today the ICQ customer base is still significant at 33 million regular users with the software being produced in more than 16 languages. ICQ is based in Tel-Aviv and employs roughly 200.
New York City-based AOL was founded in 1985 an online gaming community for Atari 2600 users. The company grew steadily into one of the world’s leading online media and social community portals, taking advantage of both the Windows and Macintosh operating systems. Today the company provides internet access, email, instant messaging, and a wide variety of media services. The company’s 4,000 employees are divided between locations in the U.S., India, and the U.K.
Digital Sky Technologies (www.dst-global.com)
DST is a global holding company focused exclusively on companies operating in the internet and related technologies sectors. The company was established in Russia in 2005 and is the market leader in the Russian speaking internet with portfolio companies holding nearly 70% of all page views. Primary investors include both Russian and Western financial institutions. Among the more well-known companies DST has invested in are Facebook, GroupOn, and Zynga.