Ybrant looks at US-Europe for acquisitions

Ybrant Technologies, the Hyderabad-based e-marketing solutions company, which acquired AdDynamix at the end of 2006, is looking at more acquisitions by 2008-end to expand its offerings in the digital marketing space.

The company is close to finishing negotiations with two US-based companies which could come under the $10 - 20 million bracket.

The company is looking at six small and mid-size players in the digital marketing space with specialisation in banner marketing. The companies they are in talks with for possible acquisition include those from search marketing, affiliate marketing and lead generation, among others.

Ybrant is scouting for small-size companies under $12 million and could look at firms of around $15 million to $20 million and slightly over that range for mid-sized companies. Most potential companies are US-based with some of them from Europe.

"We have had successful inorganic growth in the recent past with the acquisition of MediosOne, AdDynamix and Volo MP. From providing back-end services in the digital marketing space, we now want to create an end-to-end marketing network which will be accomplished by acquisition of companies in different sub-segments," said Suresh Reddy, chairman, Ybrant Technologies.

To fund the acquisitions, the company has filed its draft red herring prospectus (DRHP) with SEBI for entering the capital market with its IPO of 3.5 million equity shares of Rs 10 each. The IPO issue will be done through a 100 per cent book building process and would constitute 15.85 per cent of the fully-diluted post-issue paid-up capital of the company.

At least 60 per cent of the issue would be allotted on a proportionate basis to qualified institutional buyers. Of this, 5 per cent shall be available for allocation on a proportionate basis to mutual funds.

The company is considering a pre-issue placement of up to 1.2 million equity shares. The issue size offered to the public would be reduced to the extent of such pre-issue placement. The company has already raised $20 million from Sansar Capital and Sansar special opportunities fund, Mauritius.

Post-issue, the company plans to expand its international presence through MediosOne, the online advertising network. Initial estimates by the company have shown that such a product could have a $28 billion market in the US and Europe.