plans to expand its video offerings to include secure peer-to-peer distribution, social networking, digital e-commerce and comprehensive digital rights management through a planned purchase of Wurld Media
ROO has signed a letter of intent to purchase Wurld Media's assets for up to $10 million, to be paid in cash and ROO common stock at $4.39 per share. Under the terms of the letter of intent, ROO will immediately advance $1.5 million to Wurld Media, which shall be evidenced by a promissory note. Further, upon the closing of the acquisition, ROO will pay $6.5 million dollars in stock or cash and ROO will agree to issue an additional $2 million in ROO stock upon the achievement of milestones. The transaction is subject to certain conditions, including the negotiation and entry into definitive acquisition agreements and the completion of further due diligence. The parties anticipate that the transaction will close in 120 days or less.
Established in 1999, NY-based Wurld Media specializes in the P2P distribution of music, movies, games and TV shows The company has existing major content deals with an array of top-tier companies including 20TH Century Fox, WB, Universal, Sony, Warner, EMI, Fox Music, Fox for Movies, Atari and Activision, which are planned to continue post-deal.
This announcement comes on the heels of market research firm's Adams Media Research most recent report projecting significant increases in consumer spending on downloaded movies, music and TV shows. The report projects that pay-to-play spending will top $4 billion in 2011.
"ROO's existing customers such as News Corp., Verizon and The Street.com will have access to significant new market-derived functions along with additional opportunities for monetizing their investments in video," said Robert Petty, CEO of ROO." This provides ROO incredible competitive advantage in addition to new revenue opportunities. The acquisition of the technology and solutions from Wurld Media will enable our existing and future clients to engage their audiences at every digital touchpoint including online, mobile and IPTV in a market where enhanced distribution capability is leading the way on a global basis."