Rimage Signs Definitive Agreement for Acquisition of Qumu
Enters Rapidly Growing Enterprise Video Communications Market with Industry Leader
Transaction Valued at $52 Million, Consisting of $39 Million in Cash and One Million Shares of Rimage Common Stock
Qumu Expected to Grow Revenue More Than 40% in 2012
Rimage Board Approves 70% Dividend Increase to $0.17 per Share
Minneapolis, MN – October 10, 2011 – Rimage Corporation (Nasdaq: RIMG), the industry-leading provider of on-demand CD/DVD/Blu-ray Disc™ publishing systems, today announced that it has signed a definitive agreement for the acquisition of Qumu, Inc., the leader in enterprise video communications. The acquisition provides Rimage with a strong presence in the rapidly growing video communications market with an established partner, serving 100 Global 1000 customers and generating strong revenue growth. The purchase price totals $52 million, consisting of $39 million in cash and one million shares of Rimage common stock. The transaction is not subject to any regulatory conditions or shareholder approvals and is anticipated to close within 24 hours.
“Qumu is a cornerstone acquisition for Rimage and immediately positions us as a leader in the growing market for video communications and social enterprise applications for business,” said Sherman Black, president and chief executive officer of Rimage Corporation. “The Qumu acquisition accelerates Rimage’s strategy to distribute live, on-demand, downloaded and optical media content for a broad range of applications, on any mobile or desktop device. This acquisition significantly expands our market to new enterprise customers and offers opportunities for cross-selling to the installed base of customers of both Rimage and Qumu.”
Qumu helps corporations create, manage and securely distribute video and related content and provides analytics on content usage. With an estimated total available market of $2 billion, it serves companies in banking, technology, and telecom, among other industries, as well as universities and government agencies. It sells its products through a direct sales force and through premier distribution partners, including Sony and AT&T.
Qumu’s revenue has increased more than 45% per year over the past three years. In 2010, it generated $10.3 million in revenue and it is on track to achieve approximately $15 million in 2011. Based on current opportunities and expectations, Qumu is expected to generate approximately $21 million in revenue in 2012.
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