Rightster buys rival Base79 in deal worth up to £50m

Video marketing platform also purchases Viral Spiral and announces £42m share placing

Leading digital video distribution platform Rightster has announced the purchase of rival Base79, in a major deal which could be worth up to £50m.

Rightster, founded by 38 year old serial entrepreneur Charlie Muirhead, will pay £25m upfront for Base79, with a further £25m to potentially come if the business hits certain performance targets.

Founded by Ashley Mackenzie, the son of former Sun editor Kelvin Mackenzie, video distribution platform Base79 turned over £3.27m last year and was one of Rightster’s main rivals outside North America, with approximately 760 million views per month from content partners including Reuters, SBTV and Ministry of Sound.

Rightster also announced the purchase of viral marketing platform Viral Spiral in a deal worth up to £4.1m, which it said would add the company’s “track record and expertise” in viral marketing to Rightster’s own offering.

The deals will see Rightster more than double the number of content partners on its video distribution platform and increase aggregated traffic from 371 million views to 1.1 billion, making it the largest YouTube partner outside North America by reach and the fourth biggest partner in North America.

It marks another major stage in development for the fast-growing video distribution platform, which made headlines last year after raising more than £20.4m from its AIM IPO.

Rightster also announced the placing of 79 million ordinary shares to raise funds for the acquisitions, which is expected to raise around £42m.

The firm also announced a number of new additions to its board, including  Base79 senior executive Patrick Walker, former director of YouTube’s EMEA division.

YouTube co-founder and former CEO Chad Hurley has also bought shares in the company, and will join Rightster’s advisory committee.

Founded by Charlie Muirhead in 2011, Rightster was founded as an all-in-one video marketing and distribution platform for brands, known as a multi-channel network (MCN).

The platform continues to enjoy strong growth following its public listing, with the cash received per thousand YouTube views rising 184% between January and June this year.

Charlie Muirhead, founder and CEO of Rightster, said: “Acquiring Base79 and Viral Spiral is transformational for Rightster.

“Together, they more than double the number of content partners on Rightster’s 360 video distribution platform and catapult us past the 1 billion video views per month milestone, making Rightster the largest YouTube partner outside North America by reach and a top 5 partner in North America.

“Importantly, this greater scale and expertise improves the service we will be able to offer creators and publishers, improving our ability to both grow audiences and increase monetisation and positions us as a global leader in the exploding online video market for brands and media agencies.”

Ashley Mackenzie, founder and CEO of Base79, added: “I am delighted that Base79 will now be able to offer an expanded range of services and support to both current and future customers.

“By joining forces with Rightster, we will be able to bring the expertise and industry relationships of the combined group across the world.”

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