VisionChina Media, one of the largest outdoor digital mobile television advertising operator in China, has announced plans to acquire DMG, China's largest subway television advertising operator, for a total consideration of USD160 million.

The transaction has reportedly been approved by the board of directors of both parties and is expected to be completed in the first quarter of 2010.

According to VisionChina Media, the USD160 million will be paid in cash and stock and the payment will be divided into three parts. VisionChina Media will first pay USD100 million, including USD40 million in cash and USD60 million in stock, to DMG on the closing of the transaction. The remaining USD60 million will be paid at the first and second anniversary of the transaction, with each payment of USD30 million.

On the completion of this merger, VisionChina Media's network will cover over 30 Chinese mainland cities, including Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Chongqing, Chengdu, Nanjing, Hangzhou, Wuhan, and Shenyang. The company will also enter Hong Kong, expanding its advertising network into market outside the Chinese mainland for the first time. In addition, the number of VisionChina Media's own terminals will reach over 160,000 by the closing of this transaction, accounting for over 70% of the total mobile television terminals in China.

Founded in April 2005, VisionChina Media operates the largest out-of-home advertising networks in China and even in the world. As of October 15, 2009, its extensive networks have covered 27 Chinese cities with over 130,000 digital TV displays, reaching 340 million people.

DMG is a full-service, international, independent advertising and communications agency. It owns exclusive advertising operating rights on 27 subway lines in seven Chinese cities, including Beijing, Shanghai, Chongqing, Nanjing, Shenzhen, Tianjin, and Hong Kong. Its networks consist of 34,152 digital TV displays, providing information, advertisements, and passenger information system service to over 15.5 million passengers daily.

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