Blinkx Plc Acquires PVMG

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Blinkx Plc (LSE:BLNX), the largest video search engine in the world, announced on Wednesday in an official statement that they are acquiring Prime Visibility Media Group for £22.4 million.  BLNX shares closed down 11.3% to 137.25 p.

The two companies have entered into a stock purchase agreement, through which Blinkx is authorised to buy all issued and to be issued shares of both common and preferred stock.

Benefits of Acquisition

PVMG’s network averages over 600 advertisers and 350 publishers generating 14 million ad interactions per day. Blinkx hopes to integrate the new platform with their own so they can respond to some of PVMG’s 1.5 billion queries per day with relevant video results, mixing with these with media ads to generate more revenue.

PVMG also offers consulting services to its customers in the field of Search Engine Optimisation. Blinkx hopes to utilise the skills of these professionals to develop their internet marketing strategy, allowing the company to improve their advertising solutions.

Blinkx hopes to benefit from the experience of PVMG’s leadership team and will be taking their CEO, S. Brian Mukherjee, on as Executive Vice President and GM for Search and Mobile.

Blinkx CEO Speaks

CEO of Blinkx, Suranga Chandratillake made the following remarks on the acquisition:

“Online video advertising continues to be the fastest growing format by a significant margin, and is forecast to reach $3.5 billion over the next three years. Brands continue to move an increasing amount of their TV advertising budgets to online video, but need to be able to reach an audience of equivalent size on the Web. We’re extremely excited about the Acquisition because the integration of our video search engine with PVMG’s text search platform will enable us to tap into a new audience of intent-driven consumers and deliver TV-style brand advertising to them, which gives us the opportunity to expand our customer reach and increase PVMG’s margins over time.”

Blinkx Issues New Shares

The announcement to acquire PVMG was followed by another press release on Wednesday in which Blinkx stated its intention to place 6,500,000 new ordinary shares, representing 1.8% of the existing shares.

The proceeds of the placing of new shares will be used to fund the £22.4 million acquisition of PVMG along with the use of Blinkx’ existing cash balance.

References
 Acquisition of Prime Visibility Media Group
 Blinkx Plc Proposed Placing of New Ordinary Shares

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