Mobile application company The Meet Group (NASDAQ: MEET) of New Hope announced Wednesday that it will acquire German social dating app LOVOO for $70 million in cash.
The Meet Group includes apps MeetMe, Skout, Tagged and hi5. The company is headquartered in Union Square, where it employs more than 100.
Meet Group thinks the deal will increase its active audience to more than 15 million mobile users per month, and add to the company’s Non-GAAP earnings by next year. In fact, Meet Group expects LOVOO to become their most trafficked app, diversifying their mobile revenue, and more than doubling international, subscription, and in-app purchasing revenue.
“We are very excited to expand our global footprint and add LOVOO to our portfolio of apps,” commented Meet Group CEO Geoff Cook. “LOVOO is our third strategic acquisition in the last 12 months, and will represent our largest single app in terms of traffic.”
The deal will move forward swiftly, according to Cook, without significant regulatory or shareholder hurdles.
“We expect no regulatory approvals, no additional votes, and to close in October,” he explained. “The seller has to satisfy a handful of typical closing conditions, and then we close.”
The company says the purchase will be funded with existing cash, plus about $5 million in debt.
“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,” said David Clark, chief financial officer of the Meet Group.
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 stay 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. Effective upon closing, Florian Braunschweig, current COO and Co-Founder, has will take over leadership of LOVOO as its new general manager and managing director. The rest of the LOVOO management team is expected to remain in place.