Time Warner Inc.'s Internet unit AOL LLC said Wednesday it will buy Quigo Technologies Inc. to give advertisers more control over where their ads appear.
Financial terms of were not disclosed, but according to media reports the transaction values the online advertising company at $340 million.
The sale should provide a nice return for New York-based Quigo's investors. Quigo raised a total of $45 million since opening its doors in 2000 through funding from Walt Disney Co.-backed Steamboat Ventures, Highland Capital Partners LLC, Glenrock Ventures, Institutional Venture Partners, and Meritech Capital Partners.
Quigo has two main programs: FeedPoint, a search engine tool, and AdSonar, a targeted ad technology that competes with Google Inc.'s AdSense. AdSonar lets advertisers purchase ads on Web sites tied to specific pages, sections, topics or keywords. It is the key product in the acquisition since it would help level the ad-networking field between AOL and its rivals, Yahoo! Inc., Google and Microsoft Corp.
The online advertising industry has seen a number of high-profile deals recently, including Google's $3.1 billion acquisition of DoubleClick Inc. and Microsoft's $6 billion deal for aQuantive Inc.
Now AOL is jumping into the fray. Quigo will be the fourth advertising company AOL has acquired in 2007, the company said. Earlier in the year, AOL bought Third Screen Media, a mobile advertising company, Adtech AG, an ad serving platform based in Frankfurt, Germany, and Tacoda Inc., a behavioral targeting company. In September, AOL announced the formation of Platform-A, a digital display advertising platform that reaches over 91% of the online audience.
"With Quigo, we are putting the final pieces of Platform-A in place. We will be able to offer advertisers and publishers the most advanced set of tools, including contextual and behavioral targeting, superior analytics, and access to the largest display network in the marketplace." said Randy Falco, AOL's chairman and CEO. "And by offering advertisers the ability to target ads based on the content of Web pages using Quigo's AdSonar technology, we will be able to maximize the value of publishers' ad inventory."
Quigo has a staff of about 100 and will operate as a wholly owned subsidiary of AOL within the Platform-A organization. The business will allow AOL to expand the use of contextual advertising across AOL's own Web pages, as well as its third-party networks.
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