Despite a pending break-up in the media conglomerate, IAC/Interactive (NASDAQ:IACI) is spending up to $100 million to launch a new Internet company…. In China.  IAC is planning bring its Ask.com to the Chinese market, although reports put this as a search and advertising company rather than as a transaction-based company.

The new Internet company could launch within a year and its Ask.com could be available within two years.  With the valuations that Baidu.com (NASDAQ:BIDU) and others have seen, this can’t be that big of a surprise despite the pending break-up of the online and media conglomerate.  Baidu.com trades at more than 25-times 2008 projected revenues, while  IAC trades around 1.15-times 2008 projected revenues.  It’s a wonder with numbers like this that everyone hasn’t followed Nixon to China.

IAC/Interactive is under review for our Special Situation Investing Newsletter that covers buyouts, break-ups, spin-offs, reorganization, restructuring, and more.

Jon C. Ogg
November 23, 20