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KIT Digital has been aggressively buying competitors over the past two years, picking up the assets and customers of companies like The Feedroom, Nunet AG and Narrowstep. Its buying spree continues today with the acquisition of rival Multicast Media for roughly $18 million in cash, stock and the assumption of long-term debt.
The deal will expand KIT’s client roster and revenues, particularly in government, enterprise and non-profit sectors. According to the press release, just under 1,000 organizations used Multicast’s video platform to broadcast more than 50,000 live events over the course of 2009, with customers such as FedEx, The Knot, Delta Airlines, AutoTrader.com and AstraZeneca.
Multicast receives approximately $12 million from customers licensing its video platform, as well as additional revenues from professional services. KIT Digital had $47 million in revenue of its own in 2009, and forecast that it would grow that amount by 60 percent to more than $75 million during fiscal 2010.
The deal will also give a boost to KIT Digital’s live and event-based video management capabilities. The company, which has primarily been focused on the distribution of on-demand video, will integrate Multicast’s software into its own VX-one platform, and expects the integrated solution to be ready by the third quarter of 2010.
KIT Digital has agreed to pay $4.9 million in cash and 1.3 million shares of its common stock for Multicast, and to assume approximately $4.6 million in long-term liabilities. The deal follows a $15 million public equity offering that KIT Digital closed late last week. The companies expect the deal to close by the end of March.