Source: Verizon paying $390 million for Edgecast

December 9, 2013: 12:46 PM ET

Verizon bulks up its content delivery business with Edgecast purchase.

FORTUNE -- Verizon (VZ) this morning announced an agreement to purchase EdgeCast, a Santa Monica, Calif.–based provider of content delivery networks for such clients as Twitter (TWTR) and Hulu.

No financial terms were disclosed, but Fortune has learned that the purchase price is around $390 million. This apparently includes some cash that Edgecast still hasn't spent from a $54 million funding round that closed this past summer.

Word is that Edgecast had been prepping for a 2015 IPO, and that it was profitable with around a $100 million revenue run rate. But Verizon swept in with an offer the company couldn't refuse. Not terribly surprising from a synergy standpoint – although Edgecast does have a small reseller business that may be difficult to maintain.

Very big win for Edgecast's VCs, who put in a total of $74 million (including the Series D). Namely Menlo Ventures (largest shareholder) and Steamboat Ventures (first institutional backer). It also will be a positive return for Performance Equity Management, which led the latest round.

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