Facebook (NASDAW: FB) competitor The Meet Group, Inc. (NASDAQ:MEET), a public market leader in the mobile meeting space, today announced it has executed a definitive agreement to acquire LOVOO, a social dating app, for $70 million in cash, inclusive of a $5 million contingent earn-out. This acquisition furthers The Meet Group’s strategy to innovate, acquire, and build the largest mobile portfolio of brands for meeting new people. The LOVOO acquisition is expected to expand The Meet Group’s global footprint, increase the company’s scale and profitability, and diversify its business model by adding expertise in subscription and in-app purchasing.
This Smart News Release features multimedia. View the full release here:
LOVOO is a social and mobile technology company based in Germany:
The #1 Dating App in German speaking countries (Germany, Switzerland and Austria) in terms of app store downloads. Top 3 in Southern Europe (Italy, Spain and France)
Trailing twelve-month revenue of €27.2 million or $32.4 million based on current exchange rates
Diversified revenue streams: Subscriptions 48%; In-app Purchases 24%; Ads 28%
Expected to represent The Meet Group’s largest single app in terms of traffic
Approximately 5 million monthly active users (MAU) and 1.9 million daily active users (DAU)
47,000 new global registrations per day
97 Full-time employees – Dresden and Berlin
Key highlights of the expected scale of The Meet Group plus LOVOO include:
Projected Mobile MAU of 15.8 million, an increase of 48% from The Meet Group’s 10.7 million average in Q2 2017
Projected Mobile DAU of 4.6 million, an increase of 71% from The Meet Group’s 2.7 million average in Q2 2017
Projected Mobile chats sent per day of 74.6 million, an increase of 19.9% from The Meet Group’s 62.2 million average in Q2 2017
Projected Mobile new users per day of 193,000, an increase of 32% from The Meet Group’s 146,000 per day average in Q2 2017
Financial impact of acquisition:
Expected to provide significantly increased scale in user base and revenues
Expected to diversify the Company’s revenue mix, increasing international mobile revenue by 169% and increasing mobile non-advertising revenue by 168% in Q2 on pro-forma combined basis
Expect acquisition to be accretive to the Company’s non-GAAP EPS in 2018 and beyond
Expect transaction to be financed with existing cash on hand and a non-dilutive increase to $80 million of the Company’s existing debt facility, with JPMorgan Chase Bank, N.A. and Silicon Valley Bank acting as co-lead agents
Geoff Cook, CEO of The Meet Group, said, “We are very excited to expand our global footprint and add LOVOO to our portfolio of apps. LOVOO is our third strategic acquisition in the last 12 months and will represent our largest single app in terms of traffic. We are focused on accelerating growth across our portfolio of brands through innovating our livestreaming video product and sharing best practices in monetization and engagement across the portfolio.”
The Company expects that LOVOO will remain a separate brand and standalone mobile application following the closing of the acquisition, and that LOVOO’s headquarters will remain in Dresden, Germany. The Company has extended offers to all of LOVOO’s 97 full time employees. LOVOO’s Co-Founder and CEO Benjamin Bak has agreed to assist with the transition for six months after closing. Effective upon closing, Florian Braunschweig, current COO and Co-Founder, has agreed to take over leadership of LOVOO as the new General Manager and Managing Director. The rest of the LOVOO management team is expected to remain in place.
David Clark, Chief Financial Officer of The Meet Group, added, “We expect the acquisition to close in October 2017, to be accretive to non-GAAP EPS and to generate additional free cash flow for The Meet Group in 2018 and beyond. This acquisition is expected to help further diversify our revenue streams with 48% of LOVOO’s revenue coming from subscriptions and 24% from in-app purchasing.”
Morgan, Lewis & Bockius LLP is serving as legal counsel to The Meet Group.