Online video search firm Blinkx has bought online ad company Burst Media for $30 million to help it build personalised online TV channels.
Under the deal, Blinkx will be able to create video channels for specific audiences which will be matched with Burst’s network of publishers, in effect building an online video audience for advertisers.
Blinkx said the deal would give it access to Burst’s audience of over 130 million unique users, as it also announced a trading update predicting a rise in full-year revenue of over $65 million, up around 90 percent on last year.
It expects to report an operating profit above the current analyst consensus estimates of $6.7 million for the year ended March 31.
The trading update and the deal with Burst sent shares in the group up 2.5 percent to 113 pence on Friday, while shares in Burst lept over 300 percent to 22 pence.
The offer represents a premium of around 400 percent to the mid-market closing price on Thursday.
“Up until now, the primary barrier to further television advertising budgets moving online has been online video’s inability to match the sheer scale of audience that television can deliver,” Blinkx Chief Executive Suranga Chandratillake said.
“We are extremely excited about the acquisition as it will allow us to overcome that challenge: by fusing Blinkx’s unique patented technology and large video index with Burst’s massive reach, we will have the potential to create personalized, online television that is watched by hundreds of millions of users.”