blinkx Acquires AdKarma LLC
19 Dec 2014
Leading Video Supply Side Platform Enables blinkx to Further Expand its Footprint within the Programmatic Advertising Ecosystem
London, England and San Francisco, CA - 19 December 2014 - blinkx plc ("blinkx" or the "Company"), the Internet Media platform that connects audiences with brands through professionally generated content, today announces that it has entered into an agreement (the "Acquisition Agreement") to acquire AdKarma, LLC ("AdKarma" or the "Acquisition"), a leading video supply side platform ("SSP") for an initial consideration of $15m in cash plus an additional $5m in cash or stock at the Company's option, payable on the first anniversary of the transaction (the "Acquisition Consideration"). The initial consideration for the Acquisition will be funded entirely from the Company's existing cash reserves.
The Acquisition is expected to significantly bolster and accelerate the Company's position within the programmatic or automated trading segment of the digital video advertising market. AdKarma brings to blinkx extensive supply and demand side relationships, along with access to key programmatic video technology. The addition of transparent desktop and mobile video inventory at scale will enable the company to further expand its premium video advertising footprint through its direct and programmatic demand side relationships. blinkx expects AdKarma to be earnings accretive in the first full year post acquisition.
AdKarma has consistently demonstrated a strong financial and operational profile. The latest available audited statements indicate:
Gross revenue of $13.3m in calendar year 2013, an increase of 102% over calendar year 2012;
Gross profit of $2.4m in calendar year 2013, an increase of 118% over calendar year 2012;
Income from Operations of $0.6m in calendar year 2013;
Gross assets of $5.3m as at 31 December 2013; and
Estimated calendar year 2014 revenue of at least $20m (unaudited) and Income from Operations of at least $3m (unaudited), based on blinkx accounting policies
In addition to its financial contributions to the Company, the Acquisition is expected to:
Accelerate the growth of the Company's online video advertising business, both desktop and mobile - the fastest growing segments within online advertising;
Enable blinkx to satisfy growing brand advertiser demand for premium, cross-platform online and mobile video advertising campaigns and inventory at scale;
Provide access to proprietary technology and established programmatic supply and demand side relationships to extend blinkx's desktop and mobile video footprint; and
Add a talented team, with extensive expertise, experience and relationships in cross-platform video advertising and programmatic trading
Commenting on the Acquisition, S. Brian Mukherjee, CEO of blinkx, said, "blinkx's stated growth strategy is focused on three key areas - video, mobile and programmatic, which we feel represent the future of digital brand advertising. We believe AdKarma delivers in all three areas for the Company. We are particularly encouraged by AdKarma's high-growth mobile business, which complements our own initiatives in this channel. We expect the Acquisition to expand our supply footprint with quality, transparent inventory and accelerate our growth in the fast expanding programmatic video advertising space. We are thrilled to welcome such a capable and successful team to the blinkx family. The deal further underscores our vision to become the leading, cross-screen, premium video technology platform, connecting consumers and brands through premium content worldwide."
For further information please contact:
Analyst and Investor Contact
(US) 650 731 2431
Financial Media Contacts
Edward Bridges/Charles Palmer
(UK) 020 7831 3113
NOMAD and Joint Broker for blinkx plc
Charles Lytle/Christopher Wren
Citigroup Global Markets Ltd
(UK) 020 7986 4000
Joint Broker for blinkx plc
Lorna Tilbian/Nick Westlake/Mark Lander
Numis Securities Limited
(UK) 020 7260 1000
blinkx (LSE AIM: BLNX) is an Internet media company that connects consumers and brands through premium content online. Founded in the UK in 2004, blinkx pioneered Internet Video Search using its patented COncept Recognition Engine (CORE). This technology leverages speech recognition, text and image analysis to deeply understand the meaning and context of video content to generate improved search relevancy for consumers and a brand safe environment for advertisers. Today, blinkx is a broad digital media technology, distribution and monetization platform that connects consumers, advertisers and content across four screens. Through its partnerships with hundreds of media companies, including ABC, NBC, Conde Nast, Reuters and Bloomberg, blinkx has indexed and search enabled millions of hours of video content. blinkx powers video search, discovery or monetization on thousands of online properties including Lycos, ABC, CBS and Fox Sports. blinkx is headquartered in San Francisco, California with 15 offices worldwide. For more information please visit www.blinkx.com.
AdKarma is a rapidly growing video supply side platform located in Columbia, MO. AdKarma has strong relationships with supply partners, including integrations with many leading ad networks and exchanges with over 300 publishers representing in excess of 20,000 websites for inventory across display, rich media and video. Ranked as one of Inc. 500's fastest growing businesses in the country, AdKarma has attracted some of the brightest advertising minds focused on driving growth and establishing relationships with the industry's top advertising and publishing partners.