Yahoo! has announced a definitive agreement to acquire programmatic video advertising platform BrightRoll.


Yahoo is acquiring BrightRoll, which is expected to produce more than $100 million in revenue this year, for approximately $640 million in cash.


Combining Yahoo’s desktop and mobile video advertising inventory with BrightRoll’s programmatic video platform and publisher relationships, the transaction aims to bring substantial value to advertisers on both platforms. Acquiring BrightRoll will strengthen Yahoo’s video advertising platform, making it the largest in the US.


“Here at Yahoo, video is one of the largest growth opportunities, and BrightRoll is a terrific, strategic and financially compelling fit for our video advertising business,” said Marissa Mayer, Yahoo CEO.

Next step for programmatic video advertising

Based in the tech hub of San Francisco, BrightRoll powers digital video advertising for the world’s largest brands. Clients include 87 of the top 100 US advertisers and 18 of the top 20 advertising technology companies.


The platform enables advertisers to reach four in five video viewers online and aims to improve experiences for consumers, through better quality, more relevant advertisements.


Rumours about Yahoo!’s interest in Brightroll circulated last month but it has taken until now for both sides to come to an agreement.


Tod Sacerdoti, BrightRoll CEO and founder, said: “We believe the next step for programmatic video advertising as an industry is to extend and standardise globally, make cross-device buying simple and measurable, and complement and integrate with TV.


“We are excited to join Yahoo to materially advance efforts in each of these areas. We’re still in the early innings as an industry, and together, BrightRoll and Yahoo are committed to the vision of helping grow the entire video advertising ecosystem.”


Yahoo!’s deal for Brightroll is expected to be completed in Q1 2015 and is subject to customary closing conditions.