IAC/InterActiveCorp (NasdaqGS:IAC) entered into a definitive agreement to acquire Care.com, Inc. (NYSE:CRCM) from Sheila Lirio Marcelo, CapitalG LP, managed by CapitalG Management Company, LLC and Tenzing Global Investors Fund I LP, managed by Tenzing Global Management LLC and others for approximately $520 million on December 20, 2019. Pursuant to the tender offer, stockholders of Care.com will be able to tender their shares of Care.com common stock in exchange for $15 per share in cash. In addition, the holder of Care.com series A convertible preferred stock will be able to tender its shares in exchange for a cash payment equal to 150% of its liquidation preference, plus accrued and unpaid dividends. Following completion of the merger, the common stock of Care.com will no longer be listed for trading on the New York Stock Exchange. Tim Allen will become Chief Executive Officer of Care. Sheila Lirio Marcelo is stepping down but remains on the board, and Chief Financial Officer Michael Echenberg resigned over the summer. Tim Allen, who heads IAC's global mobile applications division, will replace Marcelo following the sale. Pursuant to the agreement, Care.com is subject to customary “no shop” restrictions prohibiting Care.com and its representatives from soliciting acquisition from third parties or providing information to or participating in any discussions or negotiations with third parties regarding acquisition proposals. The merger agreement contains certain termination rights for both IAC and Care.com. Care.com will be required to pay to IAC a termination fee of $20 million in case the agreement is terminated under certain circumstances. In addition to the foregoing termination rights, and subject to certain limitations, Care.com or IAC may terminate the merger agreement if the merger is not consummated by June 20, 2020.

The transaction is subject to customary closing conditions, including regulatory approvals and the tender of shares of common stock and convertible preferred stock representing at least a majority of the voting power of Care and the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, the accuracy of the representations and warranties contained in the merger agreement, subject to customary materiality qualifications, and compliance with the covenants and agreements as of the closing of the merger and others. The closing of the merger is not subject to a financing condition. The Board of Directors of Care.com, Inc. have unanimously approved the agreement and recommended that Care.com's stockholders accept the offer and tender their shares or preferred shares, as applicable. Certain largest shareholders of Care including Sheila Lirio Marcelo, CapitalG LP, managed by CapitalG Management Company, LLC and Tenzing Global Investors Fund I LP, managed by Tenzing Global Management LLC, holding in aggregate 4.1 million common shares and 0.046 million preferred shares, have entered into support agreements to tender their share. The transaction is expected to close in the first quarter of 2020. As of January 13, 2020, offer has commenced and is scheduled to expire on February 10, 2020. As of January 21, 2020, FTC granted the early termination notice. As on January 24, 2020, the required Phase I review period under the German Competition Act with respect to the offer was terminated and no Phase II investigation was opened. Accordingly, the condition of the offer relating to obtaining approval under the German Competition Act has been satisfied.

Michael Grimes, Ed Liu, Pedro Costa and Matt Cashia of Morgan Stanley & Co. LLC acted as financial advisor to Care.com, Inc. and acted as the fairness opinion provider to Care.com, Inc.'s Board. Brandon Van Dyke and Richard L. Oliver of Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisors to IAC/InterActiveCorp. Bradley Faris, Jason Morelli, John Chory and Susan Mazur, Sarah Gagan, Matthew Conway, Grace Lee, Joshua Holian and Rita Motta of Latham & Watkins LLP acted as legal advisors to Care.com, Inc. Morgan Stanley & Co. LLC will be paid an aggregate fee of approximately $13 million for its services, approximately $1 million of which was payable in connection with the delivery of the fairness opinion and approximately $12 million of which is contingent upon consummation of the transaction. Georgeson LLC acted as information agent for IAC/InterActiveCorp while Computershare Trust Company, N.A. acted as depositary for IAC/InterActiveCorp.

IAC/InterActiveCorp (NasdaqGS:IAC) completed the acquisition of Care.com, Inc. (NYSE:CRCM) from Sheila Lirio Marcelo, CapitalG LP, managed by CapitalG Management Company, LLC and Tenzing Global Investors Fund I LP, managed by Tenzing Global Management LLC and others on February 11, 2020. Care.com, led by Chief Executive Officer Tim Allen, will be part of IAC's Emerging and Other reporting segment. The condition of the Offer relating to obtaining approval under the Austrian Competition Act has been satisfied as from February 8, 2020. The minimum tender condition is achieved and all other conditions to the Offer were satisfied or waived. The tendered shares were accepted for payment and Care.com is delisted.