Matomy Media Group (LSE:MTMY) has bought New York-based Optimatic Media Inc. /a> in a deal worth at least $25 million. Digital performance-based advertising company Matomy is traded on the London Stock Exchange, with a market cap of 96 million pounds ($145 million).
Optimatic is a programmatic monetization platform for video advertising.
The consideration for the acquisition consists of a minimum $25 million guaranteed payment plus further contingent annual earn-out cash payments payable upon Optimatic's EBITDA objectives, to be paid out of Matomy's existing resources. The combined revenues of Optimatic and Matomy for 2015 (on a pro-forma basis) are expected to exceed $315 million.
At the end of the first half of 2015, Matomy had $43 million cash.
Matomy says in its announcement of the acquisition, "Optimatic brings a unique proprietary video platform to Matomy enabling top-tier publishers to manage their inventory programmatically and a full suite of digital video Supply Side Platform capabilities built on cutting-edge technology."
For the 10 months to the end of October 2015, Optimatic earned profit before tax of $1.6 million and had gross assets (excluding cash) of $15.2 million (unaudited).
Matomy CEO and co-founder Ofer Druker said, "Matomy has strategically driven its products and services into the area most important to marketers, which is performance, and to media which consumers are increasingly engaging, which are mobile and video. Optimatic is a great fit in Matomy's main growth engines, and substantially complements our mobile programmatic growth. In the coming years, video will play an important role in the revenue that will be generated from mobile advertising." Optimatic CEO and co-founder Chris Pfluger said, "We found the right partner in Matomy, which shares our strategy and ambition. We are confident that together we will lead the market in programmatic video advertising and offer publishers one of the most robust platforms and technology on a global scale."
Optimatic will operate as an independent subsidiary within the Matomy Group and its current management team will remain in place.
Matomy's chairman is Israel advertising executive Ilan Shiloah.
A year ago, Matomy paid $18 million in cash and shares for MobFox, which also deals in programmatic advertising.
Matomy was founded in 2007 and currently employs about 400 people. In the first half of 2015, it had revenue of $125 million, 16% more than in the corresponding period of 2014, but its profit dropped 88% to $1.5 million. Since the beginning of 2015, the company's share price has fallen about 55%. The current market cap is about 58% below the $347 million after-money valuation at which Matomy raised $70 million in its floatation on the London Stock Exchange in July 2014.
Published by Globes [online], Israel business news - www.globes-online.com - on November 16, 2015
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