16.12.2013 - 19:00 Uhr

freenet Group accelerates Digital Lifestyle activities with acquisition of Jesta Digital Group

• Optimisation of the strategic portfolio through extension of mobile lifestyle applications
• Tapping of new national and international customer groups for freenet Group products
• Acquisition of all shares in Jesta Digital Group
• Financing to be covered by existing credit line

freenet Cityline GmbH, a wholly owned subsidiary of freenet AG, today signed a purchase agreement to acquire all shares in Jesta Digital GmbH, Jesta Digital Holdings, Inc. and Jesta Digital Group U.S. Holdings, Inc. This acquisition is an important milestone for the freenet Group in the successful implementation of its Digital Lifestyle strategy. It expands the freenet Group’s product range and reach and opens up international customer potential for its mobile services and content. Jesta Digital has proven mobile marketing and direct-to-customer marketing skills, and comprehensive expertise as a marketer and buyer of media services. Laveraged in the network of freenet Group companies, this know-how will contribute to a successful development of the freenet Group and its Digital Lifestyle activities. The acquisition is subject to the usual regulatory approvals. The transaction is expected to close early in the year 2014.

"We have successfully cooperated with Jesta Digital Group for more than ten years now. With the acquisition, we are consequently continuing our expansionist course in the Digital Lifestyle area, while also further reducing our dependence on the classic, ARPU-driven mobile communications business,” comments Christoph Vilanek, CEO of freenet AG. "The continued proliferation of smartphones and tablet PCs, and of data-friendly mobile tariffs, lead to a dynamically growing demand for mobile digital lifestyle applications, and we will seize these opportunities," he adds.

With around 300 employees in offices in Berlin and Los Angeles, the Jesta Digital Group is a leading global provider of leading-edge digital entertainment content and of services for users of digital applications. Beyond ringtones and dial tones, its range includes logos, full-track music, mobile games and videos, as well as other fun/lifestyle applications including very popular offerings such as ‘Bitbop’, a portal for downloading premium content, the mobile dating platform ‘iLove’, and ‘Alta Editions’, a site for online-cookbooks. Jesta Digital Group currently reaches around 100 million customers in more than 50 countries via its own mobile advertising platform, ‘Motility Ads’; the company has operations in Germany, the US, and other countries such as Italy, Austria, Switzerland and Brazil. Its business model and reach make Jesta Digital an attractive partner for networks, mobile communications companies and content provider. Mobile content is sold directly to customers using their billing relationships with more than 60 mobile operators worldwide, and the content is supported by all major mobile devices and platforms.

“The acquisition meets the conditions defined in our financial policy,” says Joachim Preisig, CFO of freenet AG. "In addition, it realises in an ideal way the strengthening of particularly valuable revenue contributors, part of our acquisition strategy. The EBITDA multiple for Jesta Digital used for the purposes of the transaction is well below the current Group EBITDA multiple of freenet AG as valued on the stock exchange.”

The parties have agreed to keep the purchase price confidential.

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