comScore and Rentrak to Merge

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RESTON, VA. and PORTLAND, ORE.—comScore, Inc., and Rentrak Corp. announced that the companies have entered into a definitive merger agreement under which the companies will combine in a stock-for-stock merger.

Pursuant to the terms of the merger, which has been approved by the boards of directors of both companies, Rentrak will merge into a wholly owned subsidiary of comScore, and each share of Rentrak will be converted into the right to receive 1.15 shares of comScore. Upon completion of the merger, comScore shareholders are expected to own approximately 66.5 percent and Rentrak shareholders are expected to own approximately 33.5 percent of the combined company on a fully diluted basis.

comScore’s current CEO, Serge Matta, will lead the combined company as CEO. Dr. Magid Abraham will remain as the executive chairman of the board. Bill Livek, Rentrak’s current vice chairman and CEO, will serve as the company’s executive vice chairman and president. Mel Wesley will continue as the chief financial officer, and David Chemerow, Rentrak’s current chief operating officer and chief financial officer, will serve as a strategic advisor to the CEO, focused on the successful integration of the two companies. The new company will also draw upon the collective talent at both companies. The combined company’s board will consist of 12 directors; eight from comScore and four from Rentrak.

The companies said the combination will enable them to introduce more comprehensive and precise technology for measuring media consumption and advertising across platforms. comScore focuses on digital audience and advertising solutions, while Rentrak specializes in census-based worldwide movie and video-on-demand measurement.

comScore expects the transaction to be mildly dilutive to its Non-GAAP EPS in 2016, and accretive in 2017. The combined company is expected to have total synergies of at least $20 million in 2016 and at least $35 million in 2017. The company also anticipates a significant portion of the synergies to be revenue related which it expects to grow over time with an attractive contribution margin.

The transaction is subject to shareholder approval of both companies, along with customary regulatory closing conditions, and is expected to be completed by early 2016.

See more at The Wall Street Journal.