Israel's advertising industry continues to attract global attention: today, Japanese advertising company Dentsu Aegis Network, a unit of Dentsu Inc., which has a market cap of $13.2 billion, announced the acquisition of Israeli performance advertising company abaGada. The acquisition price was not disclosed, but market estimates put it at $60-90 million depending on the size of milestone payments.
This is Dentsu's first acquisition in Israel, and represents a significant statement of intent. The Japanese advertising company has operated in Israel in recent years under Carat Israel. The acquisition was led by Liran Chen, CEO of Carat Israel.
abaGada was founded in 2010 by two former employees of Google Israel: Eyal Chen, CEO, and Kobi Frankental. Among the company's clients are television production company Keshet, Bezeq International, Kia, Issta, Google, Danone, and Johnson & Johnson. The three founders set up the company using their own money and, as befits a performance company, it was profitable from the outset and has not raised external funds.
abaGada will become part of Dentsu Aegis Network and transition towards operating as iProspect - Dentsu Aegis Network’s global digital performance agency. Eyal Chen will become CEO of Dentsu Aegis Network, Israel, and abaGada's 22 employees will transfer to this entity. Chen will report to Thierry Jadot, CEO of Dentsu Aegis Network, France & Middle East.
“This acquisition marks another important step in the continued growth of Dentsu Aegis Network and the reach of our digital capabilities,” said Jadot, “With advanced services, a high level of technology products and expertise delivered to globally renowned brands and partners, abaGada is a highly successful business that is both strategically and geographically suited for our global network.”
“Bringing abaGada into iProspect enables us to scale our brand presence in the crucial high tech Israeli marketplace, adding another dimension to our global digital capabilities. We look forward to welcoming Eyal and the whole abaGada team to iProspect,” said Ben Wood, Global President of iProspect.
"We are looking forward to joining Dentsu Aegis Network and offering our digital marketing services and technology to more global brands. Our dynamic team will act as the conduit between the innovative Israeli market and Dentsu Aegis Network’s and iProspect's global network, whilst continuing to provide our clients with the highest value in digital marketing," Chen said.
Published by Globes [online], Israel business news - www.globes-online.com - on April 20, 2015
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