Enterprise data, analytics and software-as-a-service company Acxiom Corporation’s (ACXM) proposed acquisition of LiveRamp was granted an early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The news failed to garner any reaction from shareholders as stock prices remained flat.
The Hart-Scott-Rodino Antitrust Improvements Act of 1976 is a U.S. federal statute that prevents the conclusion of a merger transaction until it ensures that the deal would not hurt fair competition in the market. With the early expiry of the customary waiting period under the Act, the transaction is free to proceed further. However, the $310 million deal, announced on May 14, still remains subject to customary closing conditions.
With this acquisition, Acxiom intends to bridge the gap between offline databases and online marketing applications with better connectivity and faster onboarding. This will, in turn, improve its technology platform by providing secure access to more data.
By leveraging LiveRamp’s extensive network and a rich clientele that includes some of the world’s leading brands in retail, entertainment, communications and financial services, Acxiom expects to strengthen its customer pool and venture into a potentially profitable area of digital advertising.
Acxiom and LiveRamp collectively have dealings with over 7000 customers globally. Their combined industry-leading capabilities will enable their marketing network to reach over 99% of the adult U.S. population with targeted advertising across all channels and devices.
Acxiom and LiveRamp intend to expand this capability on a global scale over the next year, particularly in Europe and the Asia-Pacific.
It is notable that Acxiom’s share price has fallen about 18% since the announcement of LiveRamp acquisition. Some analysts opine that investors might be judging the deal as too expensive and dilutive to earnings. Moreover, Acxiom’s guidance for fiscal 2015 was disappointing, with an expected decline in both revenues and earnings.
Acxiom currently holds a Zacks Rank #3 (Hold). Some better-ranked stocks include Kofax Limited (KFX), Barracuda Networks, Inc (CUDA) and EPAM Systems, Inc (EPAM), each carrying a Zacks Rank #2 (Buy).
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