Advertising platform Innovid sold at 94% premium

Zvika Netter credit: Orel Cohen
Zvika Netter credit: Orel Cohen

Innovid is merging with a Mediaocean unit at a valuation of $525  million, and will be delisted.

Three years after its flotation, technology company Innovid Corp. (NYSE: CTV) has announced a merger that will turn it back into a privately-held company. The merger, with Flashtalking, owned by Mediaocean, is taking place at a price of $3.15 per Innovid share, a valuation of $525 million for Innovid (enterprise value $500 million). The deal represents a 94.4% premium on the closing price of Innovid shares yesterday, and is at a price that Innovid has not seen for over two years. The company became listed in a SPAC deal in 2021 at a valuation of $1.3 billion.

Innovid has developed a software platform for the creation, delivery, measurement, and optimization of advertising. The merged company will be managed by Innovid co-founder and CEO Zvika Netter, and will be called Innovid. Netter founded Innovid in 2007, together with Tal Chalozin and Zack Zigdon. After raising $251 million in the 2021 SPAC deal, it bought a Scottish company, TVSquared, for $160 million.

Netter says that the deal comes against a background of a very large opportunity in the market, among other things because of the competition issues relating to Google. "Awareness of the question of separation between technology, advertising and media has risen greatly in the last year, and that creates an opportunity to move forward fast," he says. "Innovid has the biggest advertisers as its customers - Procter & Gamble, Apple, and Disney, for example - and they prefer to separate between the technological infrastructure and media, and to choose a neutral company like Innovid."

Netter says Innovid is a software company with a gross profit margin of over 80%, but that in the public market it is classed with adtech companies that buy and sell media, resulting in p/e ratios lower than those for software companies. "It’s a failure of the public arena," he says. "The merger will reflect a more realistic value for us."

In 2021, you merged into a SPAC at a valuation of $1.3 billion.

"Yes, but we’re no longer in 2021. Very many things have changed. It’s important to realize that we are a healthy, profitable company that has grown its profitability for nine consecutive quarters."

Mediaocean will buy all the shares in Innovid, and the deal does not include an injection of capital into the company itself, but Netter says that both merging companies are profitable and will have money for investment, and as a private company it will also have a different investment profile. He stresses that no layoffs are planned. Innovid employs 460 people, 100 of them at its development center in Israel, and Flashtalking 300.

Among the shareholders in Innovid are ION Crossover Partners, with a 7.9% stake at the last reporting date, which will give it $36.2 million in the merger; Sequoia Capital, with a 6.7% stake, worth $30.5 million in the merger; The Phoenix Holdings, with 5.5%, worth $25.3 million; and Lauderdale, with 5%, worth $22.9 million. Netter holds 5.7%, and will receive $25.8 million in the deal.

In the first nine months of 2024, Innovid’s revenue grew by 11.5% to $113 million, and on a GAAP basis it narrowed its net loss by 60% to $12.1 million. In the third quarter, it posted a profit of $4.7 million.

For Mediaocean, Deutsche Bank Securities Inc. is serving as financial advisor and White & Case is serving as legal advisor with Bain & Company and 3C Ventures providing strategic consulting. For Innovid, Evercore is acting as financial advisor and Latham & Watkins as legal advisor.

Published by Globes, Israel business news - en.globes.co.il - on November 21, 2024.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.

Zvika Netter credit: Orel Cohen
Zvika Netter credit: Orel Cohen
Ashot Ashkelon credit: Ministry of Defense Up 250%, Ashot Ashkelon wins another Defense Ministry order

The Israeli defense company's share price has risen 250% in the past three years since FIMI Opportunity Funds acquired control.

Liad Agmon credit: Eyal Izhar Liad Agmon steps down from Insight Partners to found startup

Serial entrepreneur Agmon has served as a partner at Insight Partners Israel alongside Daniel Aronovitz who set up the Israel office.

Shekels credit: Shutterstock Vladerina32 Shekel slide resumes amid escalating tariff war

The Bank of Israel is not expected to intervene in the forex market despite the sharp depreciation of the shekel.

Nir Zuk credit: Inbal Marmari Palo Alto Networks mulls buying AI security co for $700m

Sources inform "Globes" that on Palo Alto's radar is Protect AI.

President Donald Trump hosts Prime Minister Benjamin Netanyahu credit: Reuters Kevin Mohatt Israeli officials confident on US tariff concessions

Senior Israeli figures believe that concessions could be tied to progress on strategic regional political issues that are important to President Trump.

Phoenix Investment House CEO Avner Hadad  credit: Tommy Harpaz "The market has priced in all the bad things"

Phoenix Investment House CEO Avner Hadad says US markets could continue to fall, but that we are close to interesting territory for patient investors.

Tel Aviv credit: Shutterstock Tel Aviv slips in World's Wealthiest Cities ranking

Tel Aviv's position as one of the world's wealthiest cities took a big knock over the past year as it slipped from 42nd to 48th in investment advisors Henley & Co.'s "World's Wealthiest Cities" Top 50 ranking.

Leviathan platform  credit: Albatross C'ttee seen recommending no cut in gas exports

The Dayan committee on the future of the gas sector estimates that Israel's natural gas reserves will run out in 2045.

Accountant General Yali Rothenberg credit: Rafi Kutz Israel's fiscal deficit continues to narrow

The deficit narrowed in the twelve months to the end of March 2025, for the sixth consecutive month, Ministry of Finance accountant general Yali Rothenberg reported today.

Arkia credit: Arkia Arkia cuts Tel Aviv - New York April fares

Arkia has cut fares at the last minute, a time when prices usually soar even higher, according to the pricing method used in the industry.

Bank of Israel Governor Prof. Amir Yaron credit: Dani Shem Tov Knesset Spokesperson BoI Governor: US tariffs could push up inflation in Israel

Prof. Amir Yaron tells "Globes" that there is a risk that the new tariffs will cause inflation to rise in the US, with a knock-on effect for Israel.

US President Donald Trump and Prime Minister Benjamin Netanyahu April 7, 2025  credit: Avi Ohayon, Government Press Office Netanyahu fails to persuade Trump to remove tariff on Israel

Asked by reporters whether Israel would be exempted from his tariffs policy, US President Donald Trump replied, "Maybe not. Don’t forget we help Israel a lot."

FBI to investigate Nakash Group Israel CEO

The complaint against Avi Hormaro was filed with the FBI offices in Miami, Florida, where many of the group's companies are incorporated, "Globes" has learned.

Bank of Israel credit: Shutterstock Israel's forex reserves fell in March

Israel’s foreign exchange reserves at the end of March 2025 fell to $218.821 billion, a decrease of $1.433 billion from their level at the end of February, the Bank of Israel reports.

Bank of Israel Governor Prof. Amir Yaron credit: GPO BoI keeps rate unchanged, cuts growth forecast

The Bank of Israel is concerned about inflation, the escalation of the war in Gaza, which has raised Israel's risk premium, and the turmoil on global markets set off by the trade war.

Eilat Ramon Airport Credit: Sivan Farag Eilat Municipal Spokesperson Russian airline to kick-start int'l flights from Eilat's Ramon airport

Russian airline Red Wings is to launch direct flights between Eilat's Ramon airport and Moscow and Sochi in Russia starting June 12.

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018