• PaidContent, Monday, August 11, 2008 2:30 PM

Looks like the search industry has got a mini-Microhoo brewing, as Miva, a vertically focused PPC engine, has rejected a $41 million acquisition offer from Blinkx. The video search engine announced its intention to buy Miva on Aug. 8 for $1.20 per share--a 54% premium on Miva's then share price of 78 cents.

According to Blinkx, the deal would have been a win-win--as the video search engine would have acquired a more broad distribution network for its AdHoc video ad platform, while Miva stood to gain "immediate platform improvements," higher CPMs and new functionality for its toolbar product. Blinkx's top brass also made note of Miva's "deteriorating cash position," as the second-tier PPC provider's income fell by nearly 5% year-over-year in Q1.

But Miva turned down the offer, arguing that it "significantly undervalues Miva's assets, including our technology, brand recognition and network ..." The company has said that it is still open to all "strategic options."

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