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Mergers and Acquisitions Technology YuMe

RhythmOne and YuMe confirm purchase talks

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By Ronan Shields, Digital Editor

August 23, 2017 | 4 min read

Publicly listed adtech companies RhythmOne and YuMe have issued separate statements confirming reports that they are in negotiations, with any potential deal representing the latest transaction in adtech mergers and acquisitions (M&A).

RhythmOne and YuMe logo combined

Both parties have confirmed the talks but both are adamant that nothing has been concluded

UK-based RhythmOne, which is listed on the AIM, made the first move, issuing a statement confirming it was in talks with YuMe over a potential takeover. “Given the nature of the discussions, there can be no certainty that any transaction will proceed,” read the company statement.

“A further announcement will be made in due course if and when appropriate.”

YuMe, itself listed on the New York Stock Exchange, subsequently issued a similar statement, which described the negotiations as “YuMe’s strategic alternatives process.”

Both statements point out that no deal has yet been agreed, with the second statement stating: “YuMe has been engaged in a strategic process in which YuMe continues to consider several value-enhancing initiatives, including remaining as a stand-alone company.”

The share prices of both companies subsequently rose in the aftermath of the publication of their respective statements, with the revelations coming the same day as DoubleVerify confirmed that it had sold a majority stake to private equity outfit Providence Equity Partners in the latest M&A transaction.

RhythmOne itself took part in earlier adtech M&A activity this year, with the outfit purchasing certain assets of RadiumOne for an undisclosed amount.

At the time of the acquisition, RhythmOne claimed the purchase would allow it to gain access to customer insights, audience segmentation and targeting technology, and premium demand relationships.

Neither RhythmOne nor YuMe has issued any statement on any efficiencies such a transaction would facilitate.

Although the reports come as the US-based company revealed earlier this month that it was turning a corner with the video advertising specialist its best quarter since Q4 2013, during the three months to June 30, with a net income of $4.4m.

According to a Seeking Alpha transcript, YuMe’s chief executive officer Paul Porrini told investors at the time that its results during the second quarter of 2017 were 'record achievements.'

He added: “We delivered $11m of programmatic revenue in the second quarter, up from $2.1m for the same period last year and $9.4m sequentially. We are encouraged by this rapid growth and adoption, and believe we are well-positioned to capture additional ad spend through our programmatic offering.”

Meanwhile, RhythmOne's latest financial filing issued in March this year demonstrated that it generated revenues of $175.4m for the 2017 financial year.

Mergers and Acquisitions Technology YuMe

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