Today, looking to expand beyond the capabilities of its broadcast TV ad distribution network as well as its Unicast division, DG (formerly DG FastChannel) acquired online ad technology company MediaMind for $414 million in cash and stock. Chairman and CEO Scott Ginsburg claimed in the release, “This is a game-changing transaction that provides DG with an unmatched global footprint, broad customer reach and an innovative platform in television and the fast-growing online advertising market.” Read more.
MediaMind’s rich media creative tech as well as digital ad serving capabilities would appear to position DG for a much deeper – they had Unicast online already – commitment to cross-channel delivery of advertising.
Also, MediaMind’s ad serving products have gained traction internationally and this gives DG an increased global footprint. To give a sense of scale, MediaMind said in its last quarterly earnings statement that it expects revenues to be around $100 million and $10 million in profit – give or take a million.
So, $100 million in revs, gets a $414 million exit, or next step, for MediaMind. Will MediaMind tech lead DG going forward? DG has a bunch of different business units related to ads and distribution, and it will be interesting to see how things come together.
DG has a market cap of ~$762 million today and first quarter earnings highlights (for the quarter ended March 31, 2011) included:
- “Revenue for the three months ended March 31, 2011 increased 19% to $64.7 million compared to $54.2 million in the same period of 2010. First quarter Adjusted EBITDA increased 22% to $29.4 million compared to $24.1 million for the same period of 2010.”
- “First quarter revenue from the Company’s Internet media service division, Unicast, increased 18% from the year earlier period.”
- “First quarter revenue from the delivery of HD advertising content increased 64% to $32.4 million from the year earlier period.”
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By John Ebbert