Ybrant all set to close four buyouts

PUNE, INDIA: Digital marketing firm Ybrant Technologies has identified four companies for possible acquisitions with the intent of getting stronger on the products side.

While the identified companies will fill front-end gaps in search marketing, lead generation and affiliate marketing, they will also help Ybrant expand its global footprint. One company is based out of Europe, while the rest are from South California, Boston and Middle America in the US.

Without divulging more, chairman Suresh Reddy said, “We are in talks with these companies. Depending on how they progress, we could sign an LOI (Letter Of Intent) as early as one month or by a six-month horizon. Due diligence will follow next.”

Ybrant emerged as an end-to-end digital marketing company taking the inorganic route. The same strategy, said Reddy, would be adopted for geographical expansion. “Our initial plan was to focus on the US market alone but we have re-looked on that strategy. We are now filling holes in our global atlas and that’s why someone with a strong footprint in Europe will interest us. The only way to increase our presence is through acquisitions.” He pegs UK to be a $two billion market against the US size of $20 billion while India remains at $40 million.

Ybrant plans to fund the acquisitions with the IPO corpus. It has filed its Draft Red Herring Prospectus (DRHP) with SEBI for entering the capital market with its Initial Public Offering (IPO) of 3,500,000 equity shares of Rs.10/- each (“Issue”).

Ybrant acquired Colorado-based MediosOne last year and AdDynamix in February for $10 million. The former was a global online advertising network while the latter was strong in advertising management, video and digital media services.

Incidentally, the e-marketing space is witnessing lot of action on the M&A front. This April, Google bought ad firm DoubleClick for $3.1 billion to bolster its banner advertising business. Other recent big-gun deals were Microsoft's $6 billion deal to buy Internet marketing firm aQuantive Inc.and Yahoo’s bid for Right Media.

Earlier, CyberMedia News had reported Ybrant’s next move in the co-registration area. Co-registration is a new web traffic formula in the online advertising space along with popular models of CPM (Cost Per Thousand), PPC (Pay Per Click) and CPA (Cost Per Action), for generating unique targeted hits.

Reddy added that the company has already started offering co-registration in India while plans are afoot to enter this space in Europe through a joint venture with an Israeli company. “For the US market, the same route would be explored with a venture with Nami Media, which is a player in post-click actions and landing page optimization technologies. It is a privately held company operating in Los Angeles and Burlingame CA with investors like the Pasadena Angels.

Next on the acquisition dart board of Ybrant is attacking the affiliate marketing area and Nami would probably be a candidate to fill this gap in the future.