InMobi Acquires US co Sprout

Deal value pegged at $20-50 m; buy to offer co product and technology capabilities

OUR BUREAU BANGALORE

    Independent mobile ad network company InMobi has acquired US-based company Sprout, which creates rich media mobile advertising, for an undisclosed amount in cash and stock, the Bangalore-based company announced on Tuesday.
However, according to a person with direct knowledge of the transaction, the deal value is between $20 million and $50 million. Company officials declined to provide the financial specifics. “This acquisition gives us product and technology capability that allows us to get leadership positions in most markets,” InMobi founder and CEO Naveen Tewari said.
Tewari also indicated that announcements relating to further acquisitions by InMobi could be made in the next six months. However, additional capital-raising plans are not on the anvil. “From a fund-raising perspective, we are not announcing anything now. We are always open for conversations, but we are not announcing anything right now,” he added.
The four-year-old company, which has marquee investors such as Kleiner Perkins Caulfield & Byers and Sherpalo Ventures, has raised about $16 million in venture-capital funding so far. “This acquisition will help scale the use of rich media advertising globally — a critical next step in helping the industry realise its full potential,” said Ajit Nazre, partner, Kleiner, Perkins, Caulfield & Byers.
The focus on India as a market has also increased.
“We see India as a very fast-growing market. Prices of handsets have come down and data prices have come down as well. Thirdly, with the advent of Android platforms, coming at almost a zero-drop price, you will have very sophisticated operating systems getting proliferated,” Tewari said.
InMobi, which builds technology for mobile advertising, is said to be among the largest mobile ad service companies, competing in a market dominated by Google’s AdMob. It reaches 314 million consumers in 165 countries, through more than 36.2 billion mobile ads per month, according to a company press release. “Thebrands are looking for ways where they can increase the level of engagement with consumers. Using the rich media, the time spent for engagement goes up 10 times,” said Tewari.
Adding Value
• The company has raised about
$16 m in VC funding so far

• Acquisition to help scale the use of
rich media advertising globally

• Company likely to make more
acquisitions in the next 6 months