Consortium of investors sells FeedRoom to KIT Digital

Tue. October 06, 2009; Posted: 03:01 PM

Oct 06, 2009 (Datamonitor Financial Deals Tracker via COMTEX) -- KITD | Quote | Chart | News | PowerRating -- A consortium of investors has sold The FeedRoom, Inc., a provider of web video solutions and technology for media companies, corporations and government agencies, to KIT digital, Inc. for approximately $9.8 million. Both the companies are based in the US.

KIT digital is a provider of internet software products and solutions that enable its customers to distribute video content through internet websites and mobile devices.

As part of the transaction, The FeedRoom's controlling shareholders NewSpring Ventures, BEV Capital and Velocity Equity Partners, invested $4 million in KIT digital common shares, at a price of $11 per share, through the conversion of The FeedRoom Series F preferred shares purchased at closing.

In total, KIT digital will issue 1,312,000 shares as a result of the two transactions, comprised of 948,636 shares issued for 100% of the outstanding shares of The FeedRoom, and 363,364 shares issued in exchange for $4 million of cash invested in KIT digital common stock by The FeedRoom's controlling shareholders, at an implied price of $11 per share.

The consortium includes BEV Capital, Velocity Equity Partners, and NewSpring Ventures, LP.

Merriman Curhan Ford & Co (MCF) acted as financial advisor to KIT digital on the transaction.

Deal Value (US$ Million) 9.8
Deal Type                Venture Finance
Sub-Category             Exit
Deal Status              Completed: 2009-10-05

Deal Participants

Target (Company)   The FeedRoom, Inc.
Acquirer (Company) KIT digital, Inc.

Deal Rationale

The FeedRoom dramatically expands KIT digital's presence in North America through the addition of more than 80 enterprise customers, including Barnes & Noble, Best Buy, Bristol-Myers Squibb, BusinessWeek, General Motors, Herbalife, Hewlett Packard, Honeywell, Intel, Metlife and the U.S. Department of Defense. The FeedRoom acquisition enhances KIT digital's VX IP video management platform through the integration of key features of The FeedRoom's 'Studio' software, including an advanced management, reporting, and analytics console. In turn, The FeedRoom clients will gain access to the advanced software features of VX, including delivery of IP video to mobile devices and IP-enabled TV set-top-boxes, as well as enhanced geographical targeting and search engine optimization tools.

% Acquisition 100%

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