Think Partnership Paying $42 MM for Affiliate?

I was just tipped of by a colleague about a deal that has yet to be widely reported. Think Partnership (THK) has its eyes on a company called Morex Marketing Group who’s primary operation appears to be a Web business called Babytobee.com.

The company said it would pay up to a whopping $42 million in cash and stock for Morex, based on earnouts and pretax income generated by the company. My sources indicate that Morex has developed a Web-centered direct marketing business aimed at expecting parents. The company expects the pre-tax income for the 12 months ended Jun 30, 2005 to be around $1 to $2 million. The company expects pre-tax income to approach $5 million in 2006.

Morex shareholders will be expected to stick around and get things done. They’re entitled to earnout payments based on earnings from 2005 to 2008 payable in both cash and common stock. I hear that it’s a 50/50 cash/stock split.

Visiting the Babytobee.com site today leaves me wondering as the page is a slow-loader and seems to be broken with things like:

Could not find stored procedure ‘sp_BMP_CalculateBanManProEvenWeightings’.

… showing up all over the place. Interestingly they appear to be a straight-ahead affiliate but there’s something else going on here for sure given that there’s so little reason for someone to visit, let alone return to, this Web site… aside from it being broken today.

Clicking on both cached and live links here yields some clues.