Perion Network Ltd. (Nasdaq:PERI: TASE:PERI) and part of privately held Conduit Ltd. are merging. The companies announced an agreement today to combine Conduit’s Client Connect business with Perion in an all-stock transaction.
Conduit will spin off its Client Connect business, which includes its monetization and distribution platform for publishers and developers. Under the agreement, the spin-off company will be combined with Perion, which upon closing will issue to Conduit shareholders between 57 and 60 million shares, based on Perion’s fully diluted share count at closing. Following the closing, Perion will be owned 81% by the existing Conduit shareholders and option holders and 19% by existing Perion shareholders and option holders, on a fully diluted basis.
The companies said in their announcement, "This immediately accretive combination will create a fast-growing, 'top tier' search distribution company, generating $367 million in pro forma non-GAAP revenue and $109 million in pro forma EBITDA for the 12 months ended June 30, 2013. The newly combined Perion operation will represent more than 260,000 publisher and content partners."
Current Perion CEO Josef Mandelbaum will head the merged company, and Perion CFO Yacov Kaufman will continue on the merged company in that capacity. Josh Wine will become president of Perion and will continue to head the Client Connect division. Conduit's co-founder Dror Erez and its CFO Roy Gen will join the Perion board upon closure of the deal.
“This is a transformational event for our company, and a powerful combination for our employees and shareholders," Mandelbaum said, "This is truly a case where one plus one equals three. Our businesses complement each other and will enable us to increase investment in our monetization and distribution platform, mobile efforts, display advertising and product innovation. I am very happy to welcome all the talented Client Connect employees to Perion and look forward to continuing to build on the great success they have achieved to date.”
Conduit co-founder and CEO Ronen Shilo said, "We couldn’t be happier with this combination. Perion is a thriving, public company that shares our values of entrepreneurship and integrity. I have known Josef for a long time, and I can think of no one better equipped to take Client Connect forward.”
Perion Network has a market cap of $161.7 million.
Published by Globes [online], Israel business news - www.globes-online.com - on September 16, 2013
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