RTL Group, a European entertainment network, has agreed to acquire a 65% majority stake in the Denver-based video advertising monetisation company SpotXchange.
In addition to RTL Group’s initial investment of US$144 million (€107 million), the parties agreed on an earn-out component that might increase the initial consideration which is subjected to the future performance of SpotXchange. Under the terms of the deal, RTL Group also has the opportunity to acquire the remaining shareholding in the future.
Founded in 2007, SpotXchange currently has 180 employees with headquarters in Denver, Colorado, and offices in several US and international locations. SpotXchange provides a video advertising monetisation platform to publishers such as The Atlantic, Hearst Corporation, Meredith Video Studios, Mail Online, NDN and Adaptive Media who use the platform to maximise revenue for their desktop, mobile and connected TV video advertising inventory.
Anke Schäferkordt and Guillaume de Posch, co-CEOs of RTL Group said: “Following our investments in non-linear TV services and in multi-channel networks on Youtube, RTL Group has already become the leading European media company in terms of online video views. The logical next step in our strategy is a structural move into the area of digital monetisation – improving our skills by adding innovative data- and technology-based competencies.”
Meanwhile the two co-founders of SpotXchange, Michael Shehan (CEO) and Steve Swoboda (COO and CFO) added: “The companies comprising RTL Group operate in a de-centralised fashion which will allow SpotXchange to thrive and grow as the last independent digital video ad monetisation platform while providing significant opportunities through partnership with RTL Group’s leading European broadcast companies and top tier global content producers.”
Under the terms of the transaction, RTL Group will appoint three of five members of the board of SpotXchange. Shehan and Swoboda will continue to manage the day-to-day operations of the company, reporting to its Board. RTL Group and the management team of SpotXchange have developed a joint growth plan to keep SpotXchange on its current growth path in the US and Asian-Pacific region, while simultaneously focusing on an accelerated roll-out in Europe.
The deal is subject to US competition authority approval and is expected to close by the end of August 2014.