Anjali Sud, CEO of Vimeo
NurPhoto | NurPhoto | Getty Images
IAC is splitting its full stake in its video software company Vimeo, the company announced on Tuesday.
IAC’s shares rose more than 5.5% in premarket trading.
Upon completion of the transaction, which is expected to close in the second quarter of 2021, Vimeo will become an independent, publicly traded company.
The transaction is expected to take the form of a reclassification of IAC shares, the company said.
The planned spin-off takes place because the shares of Software as a Service (SaaS) are rising sharply, which is in part exacerbated by the Covid-19 pandemic. Vimeo saw strong user growth over the past year. Subscribers grew 24% in November. Vimeo, which previously focused on streaming entertainment, especially from independent filmmakers, implemented its plan to provide video services to businesses a few years ago.
The company reached a valuation of $ 2.75 billion in early November after raising $ 150 million in equity from Thrive Capital and GIC, IAC said.
This makes Vimeo the 11th stock company that emerged from IAC. The company recently agreed to spin off all shares in the online dating company Match Group.
Subscribe to CNBC on YouTube.