Blinkx renews bid to buy MIVA
- Added:
- Nov 19, 2008
Video search engine Blinkx has renewed its bid to buy digital media company MIVA.
The company has delivered a letter to the Board of Directors and CEO of MIVA, in which Blinkx has revived its proposal to acquire MIVA, for a revised cash consideration of $0.55 per share.
The new offer is significantly less than that offered back in August for for $1.20 per share, valuing the company at $41m. The current offer only values MIVA at $19m.
MIVA focuses on two core areas: owning and operating a portfolio of consumer destination sites and interest-specific toolbars, through its MIVA Direct division; and running a third-party contextual Pay-Per-Click ad network focused on key vertical sectors, through its MIVA Media division.
The company operates across North America and throughout parts of Europe. blinkx has worked with MIVA as a customer and partner for a number of years, but the MIVA business has reported a decline in cash for the past four quarters.
Blinkx is hoping the deal will help monetize its video search engine. The company said its matching technology would mean large portions of relevant search traffic from MIVA's search ad network would be monetizeable at higher rates through blinkx's technology.
The company also hopes to make use of MIVA’s toolbars, consumer sites and portals by intergrating its video search and ads.
Commenting on the proposal, blinkx CEO and Founder Suranga Chandratillake said: "Given the strength of our financial results last week, it's clear that certain emerging sectors of online advertising, specifically video, continue to thrive. blinkx is uniquely positioned to capitalize on that opportunity.
“We believe there is significant value in the MIVA business and real potential to increase that value for shareholders through the proposed transaction. However, because of MIVA's continued loss-making performance and rapidly declining cash position, time is of the essence. We trust that the MIVA Board will recognize that expediency is critical to realizing the benefits of this opportunity and providing stability to MIVA shareholders, customers and employees."
Chandratillake continued: "When we first publicly proposed to acquire MIVA in August 2008 we were clear in our public and private communications that we could fund the acquisition through available cash resources. We can still do so today, regardless of MIVA's significantly reduced cash position, so let there be no confusion as to the source of capital for this deal."