Brightcove has inked a deal to acquire substantially all of the assets of online video ad insertion technology vendor Unicorn Media in a cash and stock deal valued at $49 million.
Under terms of the deal announced Monday (January 6), Brightcove is offering 2.9 million shares (at $14 each), plus $9 million in cash.
Unicorn Media has developed Once, a cloud-based ad insertion and video stitching service. ESPN, NBC News and The Weather Channel are among programmers that use Once to deliver ads to a range of devices and screens. Brightcove said “a number of leading media companies” already use Brightcove and Unicorn’s platforms in tandem, and believes the deal will help to advance the multiscreen advertising market by offering partners an integrated platform.
"We believe that online video has the potential to surpass traditional TV by offering mass personalization, superior ad targeting, and frictionless distribution to more screens in more locations," said David Mendels, Brightcove CEO, in a statement. "However, media companies are struggling to effectively deliver ad-supported video content to a fragmented landscape of platforms, including mobile devices, set top boxes, connected living room devices, and a growing number of PCs that have ad-blockers installed.”
Citing Accustream Media figures, Brightcove said the online video advertising represented $10.4 billion in global spending last year, and will eclipse $16.8 billion by 2015.
Brightcove said it intends to rebrand the Unicorn Media product line as Brightcove Once, adding that Unicorn Media's headquarters in Tempe, Ariz., will become the Brightcove Southwest R&D Center, joining similar centers in Boston, San Francisco and Seattle.
Also on Monday, Brightcove announced preliminary fourth quarter revenues of $29.7 million to $30 million, higher than original guidance of $28 million to $28.5 million, and non-GAAP income from operations of $1 million to $1.3 million, versus earlier guidance of $350,000 to $650,000.
Looking ahead, Brightcove expects full year 2014 revenues to be in the range of $126 million to $130 million, including $8 million to $9 million of contribution from Unicorn Media. Non-GAAP loss from operations is expected to be $9 million to $12 million, which includes a loss attributable to Unicorn Media of $11 million to $12 million.
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