NeuLion Buys Video Tech Company DivX for $62.5M
NeuLion (NLN) has agreed to shell out $62.5 million to buy DivX (DIVX), a long-time provider of digital video streaming solutions.
With the acquisition, and the merger of NeuLion’s managed-video services and DivX’s video technology, the combined company will be able to offer customers the chance to build and mange their own digital video platforms internally, or license a fully-integrated managed services solution.
To date, NeuLion has provided streaming services to the likes of NFL, NHL, NBA, and CCTV, among other sports leagues and media companies. DivX, meanwhile, has licensed its technology to manufacturers like Samsung, LG, and Toshiba.
The pact also comes at a time when 4K streaming and viewing is expected to grow. NeuLion cites a Futuresource Consulting report that projects upwards of 100 million shipments of 4K-enabled product in 2018. Meanwhile, DivX recently rolled out its end-to-end HEVC solution to expand the use of 4K.
Of the $62.5 million involved in the deal, $37.5 million comes via shares in NeuLion common stock, while $25 million comes in the form of a two-year convertible note.
Once the deal closes, Nancy Li, CEO of NeuLion will become executive vice chairman of the merged company’s board of directors. DivX’s CEO Kanaan Jemili will succeed her as the new CEO of NeuLion. The management teams and employees of both companies will be combined.
NeuLion’s board of directors will also expand to 11 seats, with Parallax Capital Partners managing partner (and DivX chairman) James Hale and StepStone Group LP partner (and DivX board member) John Coelho joining.Tags: Acquisition, cctv, divx, NBA, neulion, NFL, OTT