CareerBuilder May Soon Be Bought for $1 Billion
Leading job board and talent acquisition solutions company CareerBuilder is in exclusive discussions to be purchased by private equity firm GTCR for $1 billion, according to a Reuters report.
Sources told Reuters that GTCR came out on top in an auction for the Chicago-based job search site and is in the process of trying to finalize the terms of a deal.
It is still possible that an agreement will not be reached.
If the deal closes for $1 billion, it would represent a downgrade in the value of CareerBuilder, based on a 2006 evaluation at $1.55 billion.
“The leading pay-to-play job boards Monster and CareerBuilder were looking for a ring from a suitor for quite a while,” said Martin Burns, a strategic consulting leader with Boston-based HireClix, a digital recruitment advertising agency. “And they both sold for quite a bit less than they would have if they’d been open to the idea at the peak, or at least near it, of their prowess.”
Global staffing firm Randstad purchased Monster for $429 million in November 2016.
The job board industry has grown crowded—employers can even post jobs on Facebook—making it more difficult to differentiate one service from another.
And job posting aggregator Indeed has become the runaway global leader in pure job search traffic.
But CareerBuilder has been quietly acquiring technology in recent years and has built a solid company with loads of potential for the right investors, said William Tincup, SHRM-SCP, an expert on recruiting technology and president of recruitment media company RecruitingDaily.
“If [GTCR] gets it for $1 billion they did not overspend,” Tincup said. “They will find tremendous value there. Most people perceive CareerBuilder as a job board. That’s just one spoke of their wheel. Behind the veil at CareerBuilder is one of the deepest and widest talent acquisition platforms in the world.”
Tincup added that CareerBuilder serves both small and mid-sized businesses (SMBs) and some of the largest companies in the world, with products and services that range from sourcing, applicant tracking and labor market analysis to staffing services, background screening and talent management.
CareerBuilder acquired background screening and drug testing provider Aurico and cloud-based benefits and HR compliance software platform Workterra, both in 2016.
Chris Russell, a recruiting technology and job board consultant with RecTech Media in Trumbull, Conn., said the reported purchase price might be high, but added that he understands why investors are interested in companies like CareerBuilder.
“Online businesses like CareerBuilder have a solid brand, cash flow and lots of [visibility],” he said. “That is an extremely valuable asset, especially in a tight job market.”
Russell added that sites like CareerBuilder have become a key part of the hiring strategy for many small to medium-sized businesses (SMBs) that want to use online job advertising to keep up applicant flow.
“SMBs don’t have the resources to source talent on their own so they have to rely on others to promote their jobs,” he said. “That is a recruiting truth that will never change.”
Television station operator Tegna announced last year that it would explore options for its 53-percent stake in CareerBuilder, including a possible sale. CareerBuilder is jointly owned by Tegna and media publishers Tribune Media Company (32 percent) and The McClatchy Company (15 percent).
The potential sale follows other acquisitions in the job board space, including Microsoft’s purchase of LinkedIn for $26 billion in December 2016, and Monster’s sale. DHI Group, the operator of the IT and engineering job site Dice, suggested last year that it too was open to a sale.
Tincup explained that ever since Indeed revolutionized the job board market by aggregating job posts from around the Web, job boards had to evolve and mature to remain relevant.
Job sites hit a blunt reality called Google, Burns said. “That’s the world’s largest job board. Everybody else is just a destination node off of that little search box. And Indeed owned that. Along with that, the number of tools recruiters and sourcers use have scaled. So did the concept of recruitment marketing. Calling up a talent acquisition leader who knows how to track source effectiveness down to the last dollar is a whole different story.”
But Tincup foresees good things from the reported deal. “GTCR will do well and CareerBuilder will have a renaissance,” he said. “They will now have an owner that really wants to invest and aggressively grow the firm. I liken it to the 30-year-old house that gets a new owner. When you own a house for 30 years, you take things for granted. The new owner comes in and just sees opportunity.”