Outbrain confirms Teads purchase in a $1 billion deal
By Ronan Shields and Kayleigh Barber • August 1, 2024 •
Ivy Liu
After weeks of hypothesis, Outbrain has confirmed its luxuriate in on the contemporary time of Teads in a deal valuing the acquisition target at excellent north of $1 billion, denoting a predominant episode within the latest revival of mergers and acquisitions within the ad tech sector.
A news start containing particulars of the transaction notes the strategy in which it may maybe perchance perchance encompass two tranches: a $725 million upfront fee, then $25 million in a deferred fee, financed thru its contemporary money resources and outdoors financing (more on that under).
The deal will peep 35 million Outbrain shares of favorite stock issued to Altice, the Europe-primarily based mostly telco that paid a reported $305 million for Teads in 2017, with the transaction furthermore consisting of $105 million of convertible preferred fairness, in step with the August 1 news start.
Talks between the reveal material advice company Outbrain and Teads, a video ad tech specialist that has traditionally dealt with ticket advertisers, obtain been previously reported, which subsequently raised questions over the structure of this form of deal.
Outbrain intends to finance the transaction with contemporary money resources and $750 million in dedicated debt financing from Goldman Sachs, Jefferies Finance, and Mizuho Bank. Furthermore, the 35 million Outbrain shares issued to Altice are valued at approximately $169 million given the favorite month-to-month imprint of its favorite stock as of July 30, ($4.82), in step with the start.
The transaction has been well-liked by the board of every Outbrain and Teads, and is anticipated to cessation within the predominant quarter of 2025, pending historical closing stipulations, with David Kostman (Outbrain’s CEO) in line to attend as CEO of the combined company.
The union will unite two of the most recognizable names within the ad tech sector. Outbrain is a illustrious participant within the performance promoting effect, albeit it has been making efforts to pay attention on more top class offerings after its July 2021 preliminary public offering.
Meanwhile, Teads which had been on the hunt for this form of deal since late final yr in step with experiences, made its title within the on-line video effect with a burgeoning footprint within the CTV effect, in step with the corporate.
Talking with Digiday, Outbrain’s Kostman described the deal as a “merger of identical sized companies.” collectively with that every introduced complimentary resources to the union.
“We lift performance, they lift ticket and video every artistic categories,” he added. “Combining the 2 most productive-in-class companies with video branding solutions is a mammoth imprint proposition.”
Here is a developing memoir.
https://digiday.com/?p=551522
