AOL, a subsidiary of Verizon Communications announced its agreement to acquire Millennial Media for $1.75 per share or nearly $250 million. The acquisition price represents a 31% premium to its closing price of $1.34 per share on Wednesday.

AOL To Acquire Millennial Media For $250 Million

Millennium Media is an independent mobile advertising marketplace. The shares of the company surged more than 29% to $1.74 per share after AOL announced its transaction today.

AOL strengthens mobile capabilities

According to the AOL, acquiring Millennial Media would help strengthen its mobile capabilities further. It also underlines its position as the first global mobile media technology company.

AOL is currently operating scaled global content brands, delivery network and programmatic advertising and subscription services platform.

With the acquisition, the company will add a leading supply-side platform for app monetizations with more than 65,000 apps to its publisher suite of offerings. AOL will also increase its mobile brand advertising scale across ONE, and it will have access to approximately one billion unique users globally. It will have robust addressable and cross-screen targeting capabilities.

The acquisition will also help AOL accelerate its mobile position in key international markets including France, Germany, Japan, Singapore, United Kingdom, and the United States.

Executive comments

AOL President Bob Lord said the company is “well positioned as consumers spend more and more time on mobile devices, and as advertisers, agencies and publishers become more reliant on programmatic monetization tools.”

Lord added that the transaction would boost AOL’s mobile competitiveness as it continues to invest in its platforms and technology. It also improves the company’s existing publisher offering with all-in monetization platform for app developers.

On the other hand, Millineal Media President and CEO Michael Barrett said, “By joining AOL, we will be adding additional mobile expertise to AOL’s growing technology assets. I am excited by what this acquisition means for our shareholders, our employees and our partners.”

The transaction will be done in the form of a tender offer followed by a merger. Millennial Media will become a wholly-owned subsidiary of AOL following the completion of the deal, which is subject top customary closing conditions and regulatory approvals.