wordpress blog stats
Connect with us

Hi, what are you looking for?

Rediff.com Shareholders Approve $3.37 Million Vubites Acquisition

Rediff.com shareholders have approved the purchase of Vubites, a local TV advertising firm founded by Rediff Chairman and CEO Ajit Balakrishnan. The acquisition is expected to be completed before December 10th, 2010. Balakrishnan, who founded Vubites in 2005, and owns all but one share in Vubites, is set to receive Rs. 13.71 crore ($3.08 million) from the deal: Rs. 1.31 crore ($295,304) for the shares, and Rs. 12.4 crore ($2.79 million) for loans he has given to the company. Rs. 1.285 crore ($289,218) will be paid by Rediff in lieu of the stock options. The total cost of the acquisition for Rediff is Rs. 15 crore, or $3.37 million.

In our opinion, this is a bailout for Balakrishnan, and even though it does reduce the conflict of interest for him, we don’t buy his reasoning for why Vubites could not have been started by Rediff itself. As the founder and CEO of Rediff.com, it was his responsibility to seek out growth opportunities for Rediff.com, not start a company that could be acquired either by Rediff.com or Rediffusion, an advertising agency that he co-founded. Rs. 1.31 crore, and recovery of his investment, is a significant upside.

But, that’s that; For all you know, delivering advertising on TV via the Internet could end up being an important source of revenue for Rediff.com, which has been making losses for many quarters now. However, we think it’s unlikely to have an impact in the short term, and certainly isn’t a case of risk diversification.

Vubites Acquisition Press Release

Rediff.com India Limited (NasdaqGM: REDF) today announces the results of its Extra-ordinary General Meeting (EGM) of its shareholders held on November 26, 2010. At the EGM, Rediff’s shareholders unanimously approved all 3 resolutions presented for vote, including the resolution relating to the acquisition of Vubites. The acquisition is expected to be completed before December 10, 2010 and once completed will enable the Company to enter the Local TV-Ad market using internet technology.

Advertisement. Scroll to continue reading.

Related:
Ajit Balakrishnan: Rediff Buying Vubites Reduces Conflict Of Interest; Product, Target Market, Test Details
– Rediff Board Approves Risky Buy Of Ajit Balakrishnan Founded VuBites; Our Take
– Surewaves Launches Spot TV With Asianet In Kerala
– How Ad Insertion Works At The MSO Level For Local Advertising On Digital Cable
– Updated: On VuBites, Rediff CMD Ajit Balakrishnan’s New Cross-Media Ad Venture

Written By

Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

Views

News

When news that Walmart would soon accept cryptocurrency turned out to be fake, it also became a teachable moment.

News

The DSCI's guidelines are patient-centric and act as a data privacy roadmap for healthcare service providers.

News

In this excerpt from the book, the authors focus on personal data and autocracies. One in particular – Russia.  Autocracies always prioritize information control...

News

By Jai Vipra, Senior Resident Fellow at Vidhi Centre for Legal Policy The use of new technology, including facial recognition technology (FRT) by police...

News

By Stella Joseph, Prakhil Mishra, and Yash Desai The Government of India circulated proposed amendments to the Consumer Protection (E-Commerce) Rules, 2020 (“E-Commerce Rules”) which...

You May Also Like

News

Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...

News

By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

Advert

135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...

News

Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Name:*
Your email address:*
*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ