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SeaChange acquires OTT platform provider Xstream for US$5.5m

SeaChange has acquired over-the-top video and cloud TV platform, Xstream, as it looks to expand into new market segments.

SeaChange paid US$5.5 million in cash and shares to secure the Copenhagen and Denmark-based business. This comprised a cash payment of US$4.6 million and 541,738 shares of SeaChange common stock.

“Xstream provides us a managed service, over-the-top video solution that already serves more than five million active subscribers globally and generates approximately US$6 million in annual SaaS revenues,” said SeaChange CEO, Ed Terino.

“Xstream’s MediaMaker video platform will enhance the SeaChange end-to-end video framework and enable us to gain near-term revenue synergies.”

SeaChange said it expects to achieve “several million dollars of cost synergies” within the first half of fiscal 2020 by combining the businesses.

“Xstream’s engineering resources are in close proximity to our engineering and development organisation in Warsaw, which will enable an accelerated integration and provide for increased velocity of roadmap deliveries,” said Terino.

“In addition to leveraging Xstream’s experienced engineering resources, we expect to realise cost synergies in sales, marketing and administrative functions, including the consolidation of multiple locations into our Warsaw offices this fiscal year.”

“The acquisition of Xstream will accelerate SeaChange’s penetration in OTT and new market segments with a SaaS revenue model and fully cloud-based end-to-end video platform that operates in a hosted managed service environment.”

Xstream’s customers include Telenor-owned Canal Digital and India’s ALT Digital Media Entertainment.