Digital media company is pushing its inorganic growth strategy as it acquires Hyderabad-based consumer Internet firm Way2online, which owns and operates Way2sms.com and 160by2.com. It is an all-cash deal, reported to be around Rs 200 crore.
“The transaction is one of the largest acquisitions in the Internet industry in India that makes ValueFirst the largest digital media company in the country in terms of revenues, as well as number of users. With this acquisition, ValueFirst will cross 50 million profiled registered users, add 40,000 fresh registrations daily and get to Rs 250 crore of revenue this financial year,” a statement issued by ValueFirst said.
The acquisition is being funded through internal accruals and by ValueFirst’s investors – New Enterprise Associates and Headland Capital. The deal would give ValueFirst access to multiple platforms like Internet, voice, SMS and e-mail. The company is also targeting revenue of over Rs 250 crore in FY13 and is to go for an IPO in the next 24 months.
ValueFirst has been following an aggressive inorganic strategy over the last three years. It acquired mobile VAS firm Cellnext Solutions Ltd in October 2009, again in an all-cash deal. The company also acquired Noida-based Packet Shaper, a telecom software and product development firm, and picked up a majority stake in the social media firm Tagg.in for an undisclosed sum in April 2010. It also made a strategic investment in Indyarocks.com, an online and mobile social entertainment platform.
“V. Raju, the founder and CEO of way2sms, and his dedicated team have created a great asset that has huge scale, traffic monetisation and excellent engagement with consumers. The potential to build further on way2sms.com and 160by2.com is immense as ValueFirst can now leverage the huge inventories that these sites have through their large sales infra and 4,000-strong client base,” said Kumar Apoorv, CEO of ValueFirst. According to a company statement, way2sms adds 30,000 new registrations daily and has more than 500 million contacts.