Referral service to be sold in light of $1.4 billion merger involving parent company
The owner of the country's second-largest senior living referral service has agreed to sell it due to a planned $1.4 billion merger with another company with two large shareholders that own its bigger competitor, the Federal Trade Commission announced Friday.
New York City-based Bankrate will sell subsidiary Caring.com, headquartered in San Mateo, CA, to settle an FTC charge that Bankrate's acquisition by Charlotte, NC-based Red Ventures likely would harm competition in the market for third-party paid referral services for senior living communities. Two of Red Ventures' largest shareholders, private equity firms General Atlantic and Silver Lake Partners, jointly own Seattle-based APlaceforMom.com, control two of the seven positions on the board of Red Ventures GP LLC, the entity that manages Red Ventures, and have approval rights for two other positions.
Karen Cassel, CEO of Caring.com, said the referral service welcomes the decision.
“It ensures that Caring.com will continue to offer seniors and family caregivers its free and valuable service and be well-positioned to be a strong, independent partner to the senior living and in-home care industries going forward,” she said.
Under the terms of the proposed settlement, Bankrate and Red Ventures would divest of Caring.com no later than six months after the merger and would provide transition services to the buyer. The FTC could appoint a monitor to ensure compliance. Bankrate and Red Ventures also would be required to establish firewalls related to Caring.com's confidential business information.
Bankrate had acquired Caring.com in 2014. Growth private equity firm Warburg Pincus announced the sale of A Place for Mom to technology investment firm Silver Lake and global growth equity firm General Atlantic in July. Bankrate stockholders agreed to become a subsidiary of Red Ventures at a Sept. 13 special meeting.
“Bankrate has been an excellent corporate sponsor during our three-year relationship. We wish Bankrate and Red Ventures all the best in their future together,” Cassel said.
The public can comment on the proposed settlement through Dec. 4. Then the commission will decide whether to make the proposed consent order final.