Yelp Inc. shares surged 16 percent after the Wall Street Journal reported the online-review website is exploring a sale.
The company is working with investment bankers and has been in touch with potential buyers, the paper said, citing people familiar with the matter. Shares of the San Francisco-based company were halted after the report, and jumped to $44.48 after trading resumed.
Last week, Yelp’s stock plummeted to its lowest level in almost two years after slipping ad sales raised concerns the company is losing its share of major advertisers. Yelp operates websites that let users search local businesses for free and read reviews about them. The company charges for advertising on those sites. It had 142 million unique monthly visitors in the first quarter, an increase of 7.6 percent from a year earlier.
Yelp, which has a market value of about $3.3 billion, would be a good acquisition for Google Inc., Yahoo! Inc., Facebook Inc. or even travel sites such as Priceline Group Inc. and TripAdvisor Inc., said Kerry Rice, an analyst at Needham & Co.
“They’ve done a great job building out local advertising and weaving together the small and medium business market, which is a really hard market to be successful in,” Rice said. “I think it’s going to have to be a hefty premium considering how high their stock price has been.”
Shannon Eis, a spokeswoman for Yelp, declined to comment on the report.
In February, Yelp purchased food-ordering service Eat24.com in a cash-and-stock deal valued at $134 million.