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Komli Media’s South East Asia operations bought by Axiata for $11.5 million


The South East Asia operations of digital advertising firm Komli Media are being bought by the Malaysian group Axiata for $11.5 million. According to an announcement at the Bursa stock exchange, an agreement to purchase Komli Asia was reached today between Adknowledge (a subsidiary of the Axiata group) and Komli Asia. The business being acquired include Komli Media’s operations in the South East Asia markets, in Hong Kong, Thailand, Singapore, Vietnam, Philippines, Indonesia and Malaysia. With this sale, Komli Media might need to change its position from “APAC’s Leading Digital Network”, given that much of its APAC business is being sold.

The rationale behind the acquisition, according to Axiata, is that it allows them to “skip past the formative stage of its business plan and scale up its presence and operations in South East Asian region.” It saw Komli’s geographical spread and diversified revenue streams as “a strong strategic fit across digital advertising verticals such as social, video, display and mobile.” Komli Asia has around 100 people in sales, advertising operations and others, with “deeply entrenched relationships with premium publishers and advertisers.”

Adknowledge Asia Pacific is an 80% subsidiary of Axiata Digital Advertising, which is a wholly owned subsidiary of Axiata Digital Services, which is a wholly owned subsidiary of Axiata Group Berhad.

Axiata says that the acquisition “does not have any effect on the issued and paid-up share capital of Axiata and will not have any material effect on the earnings, gearings and net assets of the Axiata Group for the year financial ending 31 December 2015.”

Terms of the deal

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– $11.25 million shall be paid in cash
– “The Purchase Consideration shall be adjusted with the difference between the target working capital of Komli Asia Group against its working capital which shall be determined based on the aggregate value of Komli Asia Group’s current assets less its current liabilities” as defined in the Share Purchase Agreement at the close of business on the date of completion.
– The Purchase Shares shall be acquired free from all encumbrances
– The SPA shall terminate if the conditions are not satisfied or waived by the completion date.

Still a long way to go

Komli Media, founded in 2006, has raised around $97 million in funding over the years, including:

– $30 million from Peepul Capital and existing investors Norwest Venture Partners, Nexus Venture Partners, Helion Venture Partners and Draper Fisher Jurvetson, in October 2013.
– $39 million round in June 2012
$15 million round in January 2011
– $6 million round in July 2010
– $7 million in January 2008 (though we are not sure of how much of $7 million was for Komli, and for Pubmatic which was hived off later).

Much of this funding was raised for expansion via acquisitions, especially in South East Asia:

– February 2012: AdMax; with operations in Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam markets
– July 2011: ZestAds, Mobile ad network. Mostly operating in India, but with clients from USA, UK, France, Germany, Netherlands, Norway, Denmark, Sweden, India, Thailand, Indonesia and South Africa
– June 2011: Aktiv Digital; China, Hong Kong, Singapore, Philippines and Malaysia markets.
– October 2010: Indoor Media, UK; targeting a South Asian online marketing firm.
– June 2010: Postclick; Australia based, with offices in Melbourne and Singapore.

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While not technically an acquisition, Komli also took on board Jivox’s video advertising business in APAC in 2012.

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