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World – Monster for sale?

09 March 2012

Monster Worldwide (MWW:NYS), the online recruitment firm, announced earlier this week that it had retained financial advisers from BofA Merrill Lynch and Stone Key Partners LLC in order to review “strategic alternatives.” The news has sparked rumours that the company might consider selling all or part of the Group.

This comes after the firm has lost almost 90% of its value and Chief Executive Officer, Salvatore Iannuzzi, announced last week that he was considering options to drive the firm’s share price which reached a low that was 0.67 times the value of its net assets, according to Bloomberg. Yesterday the firm’s shares closed at US$8.61 on the New York Stock Exchange, recording a slight increase of over +3.3% but shares were still down -43.76% from a year ago.

The firm’s market capitalisation has also gone down considerably in the past few years and Monster is now valued at US$1.06 billion – in 2006 this figure was US$7.5 billion.

It is believed that the online recruitment firm has been troubled by competition emerging from social networking sites, such as LinkedIn, explaining why in 2011 the firm’s profits did not meet analyst’s expectations.

Douglas Arthur, an analyst with Evercore Partners Inc. in New York, said to Bloomberg, “Once you’ve announced that you’ve retained investment banks to assist in a strategic review, all cards are on the table, including an outright sale of the business. From the market’s point of view, I think anything short of that would be a disappointment.”

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