CentralNic purchases product review business for €60 million+, issues fresh shares

Firm further expands its online advertising business with latest buyout.

CentralNic (AIM: CNIC) disclosed today that it is acquiring German product review business VGL Verlagsgesellschaft mbH for an initial enterprise value of €60 million. It will pay €67 million upfront and up to €38 million in an earnout if the business significantly exceeds projections.

VGL reviews and compares products and earns affiliate commissions when people buy the products through its links. Unlike many product review websites out there, it seems that this business actually tests products similarly to how Wirecutter does.

The business generated $55.3 million of revenue (unaudited) and $10.9 million of Adjusted EBITDA (unaudited) last year.

In addition to the fresh revenue source, CentralNic states the buyout will help diversify who it sells traffic to. Right now, nearly all of its ad revenue comes from Google Adsense. The buyout will diversify by adding Amazon and others to the mix.

To fund the buyout, CentralNic issued £42 million of fresh equity and will sell up to £3 million more.