AOL to Buy Millennial Media--Update
September 03 2015 - 9:06AM
Dow Jones News
By Chelsey Dulaney
AOL, now owned by Verizon Communications Inc., has agreed to buy
mobile advertising company Millennial Media Inc. for about $250
million, a move to grow its app monetization services.
The offer of $1.75 a share is a 31% premium to Millennial
Media's closing price on Wednesday of $1.34 a share.
Shares of Millennial Media, down 16% this year, traded up to
$1.74 a share in premarket trading.
Deal talks between the two companies had been reported in
July.
Millennial Media is one of a handful of companies that sells
mobile ads across numerous websites and apps, saying it has the
potential to deliver ads to more than 65,000 apps. The company went
public in 2012 at $13 a share, but its stock has been pummeled as
losses have piled up. Meanwhile, Google Inc. and Facebook Inc. have
dominated mobile advertising in terms of market share.
More recently, Millennial has begun embracing automated, or
programmatic, ad selling-- a major focus of AOL's rebirth even
before it was acquired by Verizon this year. With Millennial, AOL
may be able to take its own consumer data, blend it with Verizon's
rich set of data from its wireless customers, and create a powerful
ad targeting offering for mobile devices.
AOL said it expects the deal will add scale to its mobile brand
advertising options and to accelerate its position in markets such
as Singapore, Japan, and Germany.
"As we continue to invest in our platforms and technology, the
acquisition of Millennial Media accelerates our competitive mobile
offering in ONE by AOL and enhances our current publisher offering
with an 'all in' monetization platform for app developers," said
AOL President Bob Lord in a news release.
The deal is expected to close in the fall.
Verizon agreed in May to buy AOL in a $4.4 billion deal aimed at
advancing the telecom giant's growth ambitions in mobile video and
advertising. AOL has advanced technology for selling ads and
delivering high-quality Web video.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
September 03, 2015 08:51 ET (12:51 GMT)
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