Cupid is vulnerable to bid after £40m shares drop

An advert for Cupid online dating saw shares plunge on Friday. Picture: Contributed

An advert for Cupid online dating saw shares plunge on Friday. Picture: Contributed

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THE collapse in the share price of Scottish online dating website Cupid on Friday has stoked speculation it will be snapped up by US rival IAC/InterActiveCorp, owner of Match.com.

Shares in the Edinburgh and Ukraine-based business, which owns web dating sites such as BeNaughty and Girlsdateforfree.com, dropped 57 per cent to 49p – wiping more than £40 million off its value in a matter of hours. The plunge came after it responded to allegations posted by a blogger and a Ukrainian newspaper that suggested the company lured men to hand over credit card details with “fake” potential female daters.

The claims reheated a BBC investigation into the firm this year which made similar claims but which were dismissed by company founder Bill Dobbie.

In its statement on Friday, the company did not deny the latest allegations, but said it had commissioned an audit into its operations in Zaporozhye and Dnepropetrovsk as a result. It said: “The company recognises that one of the allegations in the article is that members who have signed on a three-day trial membership are then encouraged through messages created by Cupid employees to move to a full subscription. This allegation will be directly addressed by the audit.”

Svitlana Tuchynska, a journalist for the Ukrainian newspaper Kyiv Post, said that during an undercover job interview she was told the role involved posing as a female user of the dating site and ­encouraging male users to buy memberships.

Share tipster Tom Winnifrith, whose message to subscribers about the issue is thought to have sparked the share price fall, said: “Unless this story is nailed fast by ­Cupid as 100 per cent untrue the shares will slide and slide and in the wider world of the internet folks simply will not use its services.”

The statement said the company employed a “motivation team”, but added: “The team does not communicate with free members. The team does communicate with new paying subscribers to help them get the most out of the site. The team also communicates with subscribers to monitor and interrogate the sites in order to detect and identify any technical or product issues pro-actively. The team also moderates chat rooms and forums.”

Cupid has a database of millions of customers that could prove attractive to IAC, which operates websites 
such as Ask.com and Dictionary.com. In December, the New York-based IAC denied rumours it was planning a £264.4m bid for Cupid.

This month the dating website operator delivered results showing a 31 per cent jump in annual profits and promising another year of “healthy growth” ahead.

Investors in the company, including Dobbie and his brother-in-law Angus Macsween, declined to comment.

IAC was unavailable for comment.

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