Digital marketing solutions firm Brightcom Group (BCG) agreed in December to buy Indian digital consultancy MediaMint in a cash and stock deal of Rs 566 crore, but on September 6 decided to cancel the proposed acquisition.
Instead, Brightcom and MediaMint jointly decided to turn the deal into a strategic alliance, with the latter providing the back-end services for the former’s future acquisitions.

Brightcom expects the decision to cancel its acquisition of MediaMint will help save money for future acquisitions.
In a September 6 statement to the stock exchange, Brightcom said some of MediaMint’s recent additions to clients belong to the same business and could affect the growth prospects of the combined business.

“As a result, both companies have decided that it is best to pursue different growth paths,” Brightcom said in its communique, adding that both companies experienced rapid revenue and earnings growth in fiscal 2022.

In addition, Brightcom stated that the decision to cancel the acquisition of MediaMint “has the beneficial effect of saving money to spend on other acquisitions. For MediaMint, this allows them to pursue impossible growth plans with this acquisition transaction.”

Brightcom Group MD M Suresh Kumar Reddy told Moneycontrol when contacted, “An effective growth strategy uses M&A and partnerships to drive expansion. We are looking at which scenario is more suitable and is critical for a good ROI.”

Brightcom posted a consolidated after-tax profit of Rs 912 crore on revenue of Rs 5,019 crore in the fiscal year ending March 2022, made ten global acquisitions over the past few years and now accounts for more than $300 million of its revenue.

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Shares of Brightcom on the BSE closed down 3.89% at Rs 40.75 on September 6, while the exchange’s benchmark index closed the day down 0.08% at Rs 59,196.99.