Norwegian mobile phone software firm Opera Software ASA is to buy U.S.-based mobile video advertising platform AdColony, it said on Tuesday, lifting its earnings forecast for 2014.
Opera said the acquisition would strengthen its position in the fast growing mobile advertising industry, with a combined consumer audience of more than 700 million.
"AdColony is a natural fit for Opera and our mobile advertising subsidiary, Opera Mediaworks," said Lars Boilesen, chief executive of Opera.
"This acquisition will augment our services with a robust specialization around mobile video - the fastest growing segment within the mobile dvertising industry," he added.
Under the brand name Opera Mediaworks, the company has grown rapidly by acquiring firms like AdMarvel, Mobile Theory and 4th screen. It added German startup Apprupt to the list earlier this year and has said it planned to add more.
Opera said on Tuesday it would pay $75 million in cash for AdColony plus potential earn-out payments of up to $275 million, with the total purchase price estimated at about $245 million.
Earlier this month Opera had denied that it was about to make an acquisition, following a report by online publication Techcrunch that it was about to buy AdColony for up to $275 million.
The Norwegian firm also said on Tuesday it was raising its 2014 full year revenue forecast range to $435-$460 million from $390-410 million previously, and its adjusted EBITDA range to $110-120 million from $108-116 million, assuming that the transaction will be closed by Aug. 15.
The company also said it raised its 2015 "financial aspirations" to $670 million in revenue and $180 million in adjusted EBITDA, up from $500 million and $150 million respectively.Spending on mobile advertising is expected to grow to $41.9 billion by 2017, with mobile video advertising showing the highest growth rate, Opera said, citing Gartner research.