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Post by The Ultimate Nullifier on Jan 23, 2014 8:24:28 GMT -6
AOL announced a deal to acquire Gravity, a startup that lets Internet publishers and advertisers target content based on users’ tastes and online activities, for $90.7 million.
By acquiring Gravity, founded by a group of former MySpace execs, AOL wants to boost engagement by delivering content and ads that are presumed to be of greatest interest to individual users. Gravity’s system applies real-time filters to digital content, creating an “interest graph” based on someone’s interests, preferences and habits. That lets publishers offer a tailored selection of editorial and advertising content to users.
Gravity customers include Sony, Intel, USA Today and GAP. After the deal closes, expected in the first quarter of 2014, the Gravity product and team will report to Luke Beatty, head of AOL Brand Group.
“The web is moving to the era of personal, and a personal web filter will reshape how consumers get information and services,” AOL CEO Tim Armstrong said in a statement. “Gravity is joining AOL to lead the personalization transformation of AOL’s brands and platform partners.”
AOL said it will acquire Gravity for a closing purchase price of approximately $83 million. An additional $7.7 million of consideration will be deferred and paid over two years following closing. As part of the transaction, AOL will acquire approximately $12 million of net operating losses, which is expected to result in a future cash tax benefit to AOL of approximately $5 million.
Gravity was founded in 2009 by former MySpace execs Amit Kapur, Jim Benedetto and Steve Pearman.
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