Retail giant Walmart has announced its agreement to acquire Vizio Holdings Corp. for $11.50 per share in cash, a fully diluted equity value of approximately US$2.3 billion. The move sees Walmart becoming an active participant in the connected TV advertising space.

The acquisition is aimed at facilitating the growth of Walmart Connect through Vizio's SmartCast Operating System. Vizio's advertising revenue, primarily from its operating system, has been a significant contributor to the company's growth over the past five years. The acquisition will enable Walmart to create more advertising opportunities in the connected TV advertising space to connect with customers and enhance the impact of advertising spend made directly with Walmart.

"There is a lot to be excited about with this acquisition. We believe Vizio's customer-centric operating system provides great viewing experiences at attractive price points. We also believe it enables a profitable advertising business that is rapidly scaling. Our media business, Walmart Connect, is helping brands create meaningful connections with the millions of customers who shop with us each week," said executive vice president and chief revenue officer, Walmart U.S, Seth Dallaire. " We believe the combination of these two businesses would be impactful as we redefine the intersection of retail and entertainment."

The acquisition is expected to accelerate Walmart's media business in the U.S., Walmart Connect, by combining Vizio's advertising solutions business with Walmart's reach and capabilities. Founded in 2002, Vizio has over 18 million active accounts on its Smart TV operating system, SmartCast, which has grown approximately 400 percent since 2018. Vizio's platform has over 500 direct advertiser relationships, including many of the Fortune 500.

"We believe this is the ideal next chapter in Vizio's history. By bringing our capabilities and resources together, we'll drive innovation and create even more value for our customers. Walmart's approach is aligned with Vizio's mission and vision, and our technology will help bring a scaled, connected TV advertising platform to Walmart Connect," said chief executive officer of Vizio, William Wang.

"This transaction delivers immediate and compelling value to Vizio stockholders and is a true testament to the hard work of the entire Vizio team."

Vizio's Platform+ business, largely consisting of its advertising business, now accounts for a majority of the company's gross profit. Walmart Connect, the retailer's closed-loop omnichannel media business, grew 30 percent for fiscal year 2024.

The transaction is subject to regulatory clearance and other closing conditions. Vizio's Board of Directors has unanimously approved the transaction and Vizio stockholders holding approximately 89% of the voting power of VIZIO's outstanding common shares have approved the transaction.

Following the completion of the transaction, Vizio's business will be reported as part of the Walmart U.S. segment.