The transaction is expected to close in the last quarter of 2009.

Deal Type    Venture Finance
Sub-Category Exit
Deal Status  Announced: 2009-11-23

Deal Participants

Target (Company)   Teracent Corporation
Acquirer (Company) Google, Inc.

Deal Rationale

The acquisition will allow Google to improve its display advertising on the web.

"Google TV Ads is focused on enabling advertisers to target and measure television advertising more effectively," said Mike Steib, Google's Director of Emerging Platforms. "This deal with TiVo will give advertisers access to even more anonymized viewership data, making Google's dataset one of the best in the industry. Advertisers can use this data to understand which audiences and ads are most effective, which we think will ultimately lead to more relevant ads for viewers."

Google TV Ads is a flexible, all-digital system for buying more accountable and measurable TV advertising. The system allows advertisers to reach up to 96 million households. With accurate audience measurement and innovative ways to place ad spots, Google TV Ads allows advertisers to do more with less. Since launching in 2007, Google TV Ads has served over 100 billion TV ad impressions.

"Working with Google is an important milestone for our audience research business and represents a shared approach to developing innovative products and services to help the media industry better understand the effectiveness of ad campaigns in an evolving TV landscape," said Todd Juenger, Vice President & General Manager, TiVo Audience Research & Measurement. "Among the many innovative aspects of Google TV Ads, a critical role is in its ability to measure specific commercial ratings not simply averages, which is a key attribute of the TiVo data. By using TiVo's massive samples and second-by-second granularity in its currency measurement, Google TV Ads can now provide an order of magnitude of improved accountability for advertisers."

This audience research deal is limited only to the measurement of ads sold through Google TV Ads and is only available to advertisers for specifically-purchased ad placements. This agreement is not affiliated with TiVo's proprietary audience research products including the Stop||Watch(TM) ratings service, Power||Watch(TM) ratings service, True Targets(TM) data, Power||Watch(TM) for Quantcast, and Stop||Watch(TM) Local Markets.

About TiVo Inc.

Founded in 1997, TiVo Inc. (Nasdaq: TIVO) developed the first commercially available digital video recorder (DVR). TiVo offers the TiVo service and TiVo DVRs directly to consumers online at www.tivo.com and through third-party retailers. TiVo also distributes its technology and services through solutions tailored for cable, satellite, and broadcasting companies. Since its founding, TiVo has evolved into the ultimate single solution media center by combining its patented DVR technologies and universal cable box capabilities with the ability to aggregate, search, and deliver millions of pieces of broadband, cable, and broadcast content directly to the television. An economical, one-stop-shop for in-home entertainment, TiVo's intuitive functionality and ease of use puts viewers in control by enabling them to effortlessly navigate the best digital entertainment content available through one box, with one remote, and one user interface, delivering the most dynamic user experience on the market today. TiVo also continues to weave itself into the fabric of the media industry by providing interactive advertising solutions and audience research and measurement ratings services to the television industry. www.tivo.com

TiVo, 'TiVo, TV your way.', Season Pass, WishList, TiVoToGo, Stop||Watch, Power||Watch, True Targets, and the TiVo Logo are trademarks or registered trademarks of TiVo Inc. or its subsidiaries worldwide. A(C) 2009 TiVo Inc. All rights reserved. All other trademarks are the property of their respective owners.

SOURCE TiVo Inc.

http://www.tivo.com

The acquisition is Google's latest move to bolster its presence in the online display ad market, a business dominated by rival Yahoo Inc. (YHOO). It wasn't immediately clear how the deal will affect Teracent's partnership with Yahoo to deliver mobile ads.

"The Google threat to Yahoo in display is still largely in the future, but Google is building up a pretty significant war chest to take on that side of the market, potentially at Yahoo's expense," said Gartner analyst Andrew Frank.

Terms of the deal weren't disclosed.

The algorithms developed by San Mateo, Calif.-based Teracent allow advertisers, agencies and ad networks to pick and choose the format of display ads in real time, such as changing an ad's images, products, messages or colors.

The formats vary based on the user's geographic location, language, the content of the Web site, or the past performance of different ad formats. The technology can be applied across image, rich media and video ads.

Google, which makes almost all of its revenue from text ads that appear next to search results, indicated its interest in display ads by acquiring DoubleClick for $3.1 billion last year.

Neal Mohan, a vice president who oversees Google's display business, said Teracent technology would be integrated into Google's ad network and DoubleClick offerings.

Google Chief Executive Eric Schmidt said in October the company was once again looking at acquisitions and expected to buy on average one small company per month. He said Google had looked at a handful of startups working on better ways to sort and deliver display ads.

Google earlier this month bought Internet telephony startup Gizmo5 Technologies Inc. and mobile advertising group AdMob Inc.

Google shares closed up 2.2% at $582.35.

Ciena to buy Nortel's Ethernet assets Beats out bigger vendors with $769 million offer Ciena Corp. will buy the optical and metro Ethernet business of bankrupt Canadian firm Nortel Networks for $769 million, trumping an offer from Nokia Siemens Networks after a three-day auction, under a deal announced Monday.

Many industry analysts had expected Ciena to be outbid by one of its larger rivals, but fewer suitors than expected emerged and Ciena raised its offer by 48%. Nokia Siemens eventually dropped out, saying it couldn't justify bidding higher.

"I would argue that this asset is more valuable to us than anyone else," Chief Executive Gary Smith told MarketWatch in an interview. "It's a great fit." Shares of Ciena (CIEN 12.10, +0.10, +0.83%) , however, retreated 6% to $12.46 in morning trading on concerns that the price might be too high for the Linthicum, Md.-based networker.

Ciena's winning bid consists of $530 million in cash and $239 million in convertible notes. It's considerably higher than the company's original offer of $521 million. See story on Ciena's longshot bid.

"This is a fair price to pay for this kind of technology and asset," Smith said.

The purchase is not without considerable risk. It will sharply increase Ciena's debt, double the size of the company and expand its operations into Canada. The company plans to make job offers to at least 2,000 employees of Toronto-based Nortel.

Analysts say the success of the deal will largely depend on how well and how quickly Ciena meshes Nortel's assets with its own.

"We can't think of anyone in Ciena's management team that has ever been involved in -- much less integrated -- an M&A deal like this," the brokerage Jefferies & Co. said in a note to clients.

To address that concern, CEO Smith has hired outside consultants with experience in large mergers. He also said the long bidding process gave Ciena time to more closely examine the assets and prepare an integration plan.

"We're going into this with our eyes wide open," he said.

Despite its financial failings, Nortel was one of the world's largest makers of optical gear and it's equipment is used by many of the world's leading phone companies such as blue chips AT&T Inc. (T 26.74, -0.04, -0.15%) and Verizon Communications Inc. (VZ 31.20, -0.13, -0.42%) as well as Japanese giant NTT (NTT 20.53, +0.03, +0.16%) .

The unit being acquired by Ciena is expected to generate sales of about $1.1 billion in the current fiscal year. By contast, Ciena is forecast to generate about $644 million in sales in fiscal 2009.

The acquisition of the Nortel assets would tighten Ciena's relationships with large phone carrier -- critical to any networker's survival -- and strengthen its position in the fast-growing optical and Ethernet market. Yankee Group researchers estimate that sales in that segment of the networking market could reach as high as $85 billion by 2012.

With the Nortel assets now being transferred to Ciena, executives believe sales will stabilize after a 20%-plus decline in 2009, much of which can be blamed on a severe recession.

"A lot of customers were holding back," Smith said.

Ciena said the acquisition would add "significantly" to operating profits starting in fiscal 2011. The deal is expected to close in the first three months of 2010.

Nokia loses again Nokia Siemens Networks, the telecom-equipment joint venture of Finland's Nokia Corp. (NOK 13.47, +0.06, +0.48%) (FI:NOK1V 8.96, -0.14, -1.54%) and Germany's Siemens AG (DE:SIE 66.30, +2.18, +3.40%) (SI 99.15, +0.18, +0.18%) , said in a statement Monday that it didn't submit the highest bid because it "could not be financially justified." The joint venture lost a similar auction in July, when Swedish rival Ericsson (SE:ERICB 70.10, -0.10, -0.14%) (ERIC 10.15, +0.05, +0.50%) outbid it for Nortel's CDMA wireless assets.

Nokia Siemens had been seen as keen to acquire the optical networking and Ethernet assets to reinforce its position in North America, where it has failed to gain a solid foothold. In the past few quarters, the money-losing venture has struggled to compete with fast-rising rivals such as China's Huawei Technologies.

In a broadly higher market, U.S.-listed shares of Siemens added more than 4% while Nokia rose 1%.

Last month, Ciena made a stalking-horse offer for the Nortel assets valued at around $521 million. Analysts generally expected a bidding war to send the price up toward $900 million

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The transaction is expected to close in the last quarter of 2009.

Deal Type    Acquisition
Sub-Category Majority Acquisition
Deal Status  Announced: 2009-11-23

Deal Participants

Target (Company)   Teracent Corporation
Acquirer (Company) Google, Inc.
Vendor (Company)   Undisclosed Vendors

Deal Rationale

The transaction will allow Google to improve its display advertising on the web.