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December 20, 2005
SOLD for $21 Million a Click Fraud Detection Firm
Think Partnership To Acquire Click Fraud Detection Firm
The deal calls for Think Partnership to pay $6.5 million in cash and $6.5 million in stock for Litmus. Earnout payments could push the value of the deal to $21 million.
Think Partnership CEO Gerard M. Jacobs stated, "This is an extremely significant acquisition for Think Partnership. Click fraud is a major problem for the advertising clients of the search engines and affiliate marketing networks. Click fraud currently is only dealt with after-the-fact, on an ad hoc complaints-made basis; it's a very unsatisfactory, expensive situation for advertisers. Litmus Media's technology changes the game dramatically. It identifies fraudulent clicks in real-time - 'in the clickstream', so to speak - and makes sure that advertisers aren't charged for those clicks. This gives advertisers a huge incentive to use Litmus' technology platform and to pay more for Litmus' pre-screened legitimate click stream. These higher advertiser payouts, in turn, are immensely attractive to website publishers who want to participate in Litmus' ValidClick Network. Both web publishers and advertisers profit from the technology, which explains why Litmus is so profitable and growing so rapidly."
Think Partership, with 11 operating companies including WebSourced, Inc, and KeywordRanking.com.
The Company expects Litmus to add more than $4 million of pre-tax income to the Company during 2006.
Posted by dj at December 20, 2005 01:23 PM