Streaming Media
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Brightcove, the Technical Emmy winning video platform vendor, has been sold to app developer Bending Spoons for $233 million. It is the Italian company’s sixth acquisition this year and it is thought to be planning an IPO on the NYSE.
Brightcove’s most recent market cap was $143.98 million,
which is notably lower than the acquisition price, reflecting the “substantial
premium” Bending Spoons is offering to shareholders, according to InvestingPro.
Brightcove maintains a gross profit margin of 61.65%, indicating strong
underlying value in its core business which may explain Bending Spoons'
interest in acquiring the company.
Brightcove was founded in Boston in 2004 starting out with a
video player and expanding into a full online video services and monetization
suite. Since its IPO in 2012, the company has focused on delivering video
streaming solutions to a diverse clientele, including BBC, Showtime, AMC
Networks and the LPGA.
Of late however it has faced challenges, reporting a net
loss of $3 million for its latest quarter to November 4. The company’s
financial health has been under scrutiny with its growth metrics considered underwhelming.
InvestingPro judged its financial
performance to be “mixed”, with stagnation in revenue growth for the last
twelve months (at $199.8m a slight decline of 0.22% year-over-year) a factor in
the Brightcove’s decision to pursue a strategic sale.
Last month, Edenbrook Capital doubled its stake in the
company to nearly 30%. Analysts
noted at the time that Edenbrook might be positioning for a “value play,” anticipating
a “potential market correction or strategic shifts within Brightcove that could
enhance shareholder value.”
In August, the Milan headquartered Bending Spoons bought
file-sharing platform WeTransfer. That followed the July purchase of digital
publishing platform Issuu, the live streaming app StreamYard in May. In
February it paid around $100m for the digital assets of Mosaic Group, which
makes apps for mobile phones, and Meetup, a social network with 60 million
members used to organise in-person and virtual events and gatherings. In
January 2023 it acquired note-taking software firm Evernote.
Bending Spoons, which launched in 2013 and named after a
scene in The Matrix, had a valuation of over $2.5 billion as of
February. Its 39-year-old CEO and co-founder Luca Ferrari told Reuters, “If and
when we choose to pursue an IPO, we'll evaluate all reasonable options. Today,
we have a slight preference for a listing in the United States, but our views
may change.”
Marc DeBevoise, Brightcove’s CEO since 2022, said,
“Brightcove is a storied and successful enterprise SaaS leader with 20 years of
history, 12 of them as a public company. We have been a pioneer and innovator
in the streaming market, from the early days of video player technologies to
the leading video-powered engagement platform we are today. Today’s
announcement will enable Brightcove to leverage the technology and market
expertise of Bending Spoons and best position Brightcove to continue to thrive
in the streaming and engagement technology market.”
The transaction is expected to finalize in the first half of
2025.
Akamai acquires Edgio assets
After filing for Chapter 11 bankruptcy
in September select assets of CDN Edgio were picked up by Akamai
last week. Edgio listed $379 million in assets and $369m in liabilities,
according to court papers. At the time, its network comprised 300 Points of
Presence (PoPs) worldwide, more than 7,000 ISP interconnections, and more than
275Tbps of global capacity serving around 900 customers.
Akamai was the winning bidder of the assets which included
customer contracts from Edgio’s businesses in security and content delivery,
and non-exclusive license rights to Edgio’s entire patent portfolio. No assets
related to the Edgio network were acquired by Akamai.
Dan Rayburn noted
that investment firm and Edgio debtor Lynrock won the assets for Uplynk and
Interdigital, some of Edgio’s patents.
Edgio was only formed in 2022 after Limelight Networks
acquired Edgecast from Yahoo and Apollo Global Management, with the combined
company rebranding that year. Between 2013 and 2016, EdgeCast was a subsidiary
of Verizon. Verizon acquired Yahoo! in 2017 and merged it with its Verizon
Digital Media Services business (including the CDN service) to form Oath and
later Verizon Media.
In 2023 Lumen and StackPath
quit the CDN business, selling their enterprise customers to Akamai.
For sale alert
One company with a ‘for sale’ sign to watch is Harmonic. The
cable and video technology company initiated a review of its assets at the end
of 2023 after posting a net loss of $6.5 million for its Q4. The company abandoned
those plans in the spring, citing a soft buyer’s market, but a sale of some or
all its divisions are now back on the table with 2.3% stakeholder Ancora
Holdings urging the board Harmonic to explore a possible sale and maximise
shareholder value.
Romanesque Capital, another a Harmonic shareholder, supported the call for a review aimed at a possible sale. Multiple cable industry experts have speculated to Light Reading that Comcast could make a good fit as buyer given the operator's reliance on Harmonic's virtual cable modem termination system.
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