Blinkx to buy Burst Media for $30 million

LONDON, UK: Online video search firm Blinkx is to acquire the online ad company Burst Media for $30 million to help it build personalised online TV channels which would be hugely appealing to advertisers.

Blinkx said the deal would give it access to Burst's audience of over 130 million unique users, as it also announced a trading update predicting a rise in full-year revenue of over $65 million, up around 90 per cent on last year.

It expects to report an operating profit above the current analyst consensus estimates of $6.7 million for the year ended March 31.

The trading update and the deal with Burst sent shares in the group up 2.5 per cent to 113 pence on Friday.

The offer represents a premium of around 400 per cent to the mid-market closing price on Thursday.

Under the deal, Blinkx will be able to create video channels for specific audiences which will be matched with Burst's network of publishers, in effect building an online video audience for advertisers.

"Up until now, the primary barrier to further television advertising budgets moving online has been online video's inability to match the sheer scale of audience that television can deliver," Blinkx Chief Executive Suranga Chandratillake said.

"We are extremely excited about the acquisition as it will allow us to overcome that challenge: by fusing Blinkx's unique patented technology and large video index with Burst's massive reach, we will have the potential to create personalised, online television that is watched by hundreds of millions of users."