Level 3 Communications, Inc. (NASDAQ:LVLT) today announced that its operating subsidiary has acquired Servecast Limited, a Dublin-based provider of live and on-demand video management and streaming services for broadband and mobile platforms. Level 3 has paid approximately €33 million, the equivalent of approximately $45 million, in cash to complete the acquisition of Servecast. Founded in 1998, Servecast offers proven publishing and distribution tools for video rights holders to monetize their digital assets. These tools enable customers to manage, protect, deliver and track online audio and video content. Servecast provides an easy-to-use platform that supports multiple stream rates, languages, currencies and formats, including Adobe Flash™, Real Player™, Windows Media Player™ and Apple QuickTime™. Servecast’s capabilities have been developed for easy adaptation to emerging video formats and other content delivery technology.
“Servecast’s video and rights management platform, combined with its streaming services complement Level 3’s existing portfolio of content delivery capabilities,” said Brady Rafuse, president of Level 3’s Content Markets Group and European Markets Group. “The addition of these services accelerates our planned development of this technology. These capabilities will enable us to manage and distribute online video content in multiple formats to meet the increasing demand for high-quality video over the Internet.”
“We are excited to be joining Level 3,” said Darach Deehan, chief executive officer of Servecast. “We believe Level 3’s scale and capabilities across Europe and North America will provide our customers an important opportunity to access new markets.”
“We are confident in our ability to continue offering Servecast’s customers high-quality service as we incorporate these key capabilities into our portfolio and expand the availability of these services to additional markets in Europe and into new markets in North America,” said Rafuse. “This is a strategic capabilities acquisition that does not require the type of physical integration associated with our larger, previously announced metro and backbone transactions.”
Level 3 plans to maintain Servecast’s headquarters and broadcast operations center in Dublin, as well as its data centers in London and Amsterdam. Servecast’s existing streaming server sites throughout Europe and North America will also be incorporated into Level 3’s Content Delivery Network.
Servecast had approximately $5 million in annual revenue for 2006. IBI Corporate Finance advised Servecast in relation to the transaction.