By Tess Stynes
Adobe Systems Inc. (ADBE) agreed to acquire ad technology company TubeMogul (TUBE) in a deal valued at roughly $515 million that aims to strengthen Adobe's position in digital marketing and advertising technology.
The deal, expected to close early next year, is valued at roughly $540 million, net of debt and cash.
TubeMogul holders will receive $14 a share for each share held, an 83% premium to Wednesday's close. The company's shares have been halved since April amid a shift in ad spending from desktop to mobile. The stock soared 82% to $13.98 in recent premarket trading.
Brad Rencher, Adobe's digital marketing general manager, said that with the acquisition of TubeMogul, Adobe is aiming to create a "one-stop shop" for video advertising for its marketing cloud customers.
TubeMogul's technology includes a product designed to help marketers buy web video ads aimed at specific people using automated software through direct buys with a number of well-known media companies simultaneously.
Adobe and TubeMogul share some big customers, including Allstate Corp. (ALL), Johnson & Johnson (JNJ) and Southwest Airlines Co. (LUV).
TubeMogul, which will become part of Adobe's digital marketing business, will continue to be led by its current chief executive, Brett Wilson.
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(END) Dow Jones Newswires
November 10, 2016 09:22 ET (14:22 GMT)
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