Limelight to acquire Yahoo's Edgecast for software solutions
Limelight Networks, a leading provider of edge enabled web applications and content delivery solutions, today announced that it has entered into a definitive agreement to acquire Yahoo's Edgecast, Inc. ("Edgecast"), a leading provider of edge security, content delivery and video services, in an all-stock transaction. The transaction values Edgecast at approximately US$300mn.
Edgecast is a business unit of Yahoo, which is owned by funds managed by affiliates of Apollo and Verizon Communications. Yahoo will receive approximately 72.2mn in shares of Limelight common stock and will own approximately 31.9% of the combined company at closing.
"By uniting Limelight and Edgecast, we are building a powerful application, content and video edge enabled solutions company that delivers improved customer performance, productivity and security for the outcome buyer," said Bob Lyons, Chief Executive Officer of Limelight. "Together we have a strong value proposition to serve the fast-growing, yet fragmented edge solutions market and our combined capabilities will accelerate our ability to capture more share of this high growth US$40bn total TAM.
“In six short months we have taken our TAM from US$12bn to US$40bn and with the acquisition of Edgecast, we are further accelerating and solidifying our ability to be recognized as a leader in edge software solutions for the outcome buyer."
Creating a global edge-enabled software solutions provider
The combination will create a globally scaled, edge-enabled software solutions provider with pro forma 2021 revenue of more than US$500mn across cloud security and web applications, content delivery and edge video platform. In anticipation of the transaction, Limelight will rebrand as Edgio, with the combined company continuing to operate as Edgio following close.
With global scale, a leading distributed edge platform and increased focus on security and connectivity, Edgio will be a leading solutions provider of choice for outcome-oriented businesses and clients looking to deliver a fast, secure and frictionless digital experience to end-users.
"At Yahoo, we are focused on driving value creation for our business and customers," said Jim Lanzone, CEO of Yahoo. "By spinning off Edgecast to merge with Limelight, the new company will immediately become the leader in the massive and growing edge solutions market. I am confident in the value and strength of this combined company, and the growth it will drive for Yahoo, Edgio and Apollo."
With a significant equity investment in the combined company from its existing ownership of Yahoo, the Apollo Funds are committed to supporting the growth strategy and innovative vision for the combined company.
"Ever-increasing consumer demand for faster performance, enhanced security and higher-quality digital content has fundamentally changed how and where companies deliver value online to end users," said Apollo Partner Reed Rayman, who will join the combined company's Board of Directors.
"As the market continues to rapidly evolve and expand, the combination of Limelight and Edgecast will have greater strength and scale to capitalise on these trends and better serve its clients. We believe this is a transformative transaction and are thrilled to back this management team as shareholders and board members to support Edgio in its exciting next phase."
Image: Yahoo
