AOL announces Adap.tv buy for USD 405 million
Global web services company AOL Inc announced that it would be purchasing Adap.tv for USD 405 million, which would be paid in cash and stock. AOL would pay Adap.tv USD 322 million in cash and USD 83 million in stock.This would be AOL's biggest acquisition since Huffington Post, which it bought in 2011. Adap.tv is an online video advertising platform. Through its technology tools and services, Adap.tv automates the process of buying and selling process of videos, allowing advertisers to control their advertising business.
The revenues generated by AOL's dial-up subscription service have dwindled recently, prompting the company to turn to marketers for sales. In the past three months, the firm's strategy was to rely on video advertising. Apparently, this worked for AOL as its revenues for the second quarter was higher than expected, fueled largely by third party network display, search and ads. Thomson Reuters data revealed that revenue was up to USD 541.3 million, exceeding average estimates given by analysts, who predicted revenue only at USD 539.6 million.