RhythmOne buys YuMe for $185 million

Ad exchange RhythmOne announced today it is buying video ad platform YuMe, creating what the companies said will become a top-ranked marketplace.

Started in the UK in 2004 as blinkx and now based in San Francisco, RhythmOne offers a programmatic ad exchange, RhythmOneMax, that encompasses desktop and mobile video, rich media, display ads, social and native ads, and various content formats. Its RhythmOneGuard utilizes third-party verification and proprietary filtering to support brand-safe environments. Here’s a sample screen shot:

YuMe, based in Redwood City, California, is a platform for video ads on mobile, desktop and connected TV:

RhythmOne CEO Ted Hastings told me via email that RhythmOne brings a supply-side orientation with analytics, a data management platform (DMP) and brand safety leadership, while YuMe offers demand-side software, first-party data management of YuMe’s SDK-based inventory, strong relationships with agencies and brands and “a robust targeting platform with global programmatic capabilities” for mobile, video on the web and connected TV.

The $185 million deal is expected to close in first quarter of next year, by which time the platforms will be integrated. The companies said the new entity, which will keep the RhythmOne brand, will reach about 220 million visitors monthly and provide access to one of the largest cross-device inventories around.

The RhythmOne crew will continue to work out of its San Francisco offices, while YuMe will stay in Redwood City. Hastings will be president and CEO, and YuMe Chairman Eric Singer will become chairman of the newly constituted board of directors.