BUSINESS

NeuLion to bolster position in Internet video market with DivX acquisition

01/05/2015 07:24 EST | Updated 03/07/2015 05:59 EST
PLAINVIEW, N.Y. - NeuLion, Inc. (TSX:NLN) has an agreement to acquire DivX LLC with a combination of shares and debt valued at US$62.5 million.

The deal will combine two technology companies foused on delivering video content to Internet-enabled devices such as computers, smartphones and tablets.

NeuLion delivers live and on-demand content to Internet-enabled devices. It was selected by Rogers Communications (TSX:RCI.B) to power the NHL GameCentre Live service through the 2014-15 hockey season.

DivX technolgoy is used to create and distribute video for multiple devices by companies such as LG, Samsung and Toshiba.

NewLion said Monday it will pay for the DivX purchase with about 35.9 million common shares, valued at $37.5 million, and a $25-million two-year convertible note.

The companies say DivX's chief executive offier, Kanaan Jemili, will be appointed CEO of NeuLion. Nanci Li, NeuLion's current CEO, will become executive vice-chairman of an expanded board of directors that will include two members of DivX's board.

NeuLion is based in Plainview, N.Y., and listed on the Toronto Stock Exchange. Based on on Friday's closing stock prie of C$1.34 per share, the compahy had a market value of about $238.7 million.