Outbrain to buy Teads from Drahi’s Altice for $1b

Israeli Content Recommendation Company Outbrain Company OB (NASDAQ: OB) announced that it is acquiring Tedz, a supply-side platform and video monetization company owned by Patrick Drahi’s Altice, the parent company of Hot Telecom Systems.

Outbrain will acquire Teads in a deal valued at approximately $1 billion with $725 million in upfront cash, $25 million in deferred cash, plus stock and convertible preferred stock.

“This is a transformational transaction to create an end-to-end, integrated platform for the open internet,” said Outbrain CEO David Kostman, who will continue to serve as CEO of the combined company. “Combining our highly integrated offerings accelerates our vision to become the partner of choice for delivering meaningful brand outcomes across premium, high-quality media environments – while expanding the industry-leading offerings Teads is known for.”

“I am extremely proud of what our team has built at Outbrain, and I firmly believe that together with Teads we will build tremendous value for our customers, employees and partners. I believe this combination and the financial structure of the transaction positions Outbrain to deliver significant value to shareholders for years to come,” he added.

The combined company will provide advertisers with unified access to consumer media experiences, from connected TV to online shopping. Once complete, the company will represent a break from the established platform players that primarily build their value on views and impressions. Instead, the combined company plans to focus on delivering more tangible outcomes like attention, deep engagement and e-commerce conversions across the many distinct, previously fragmented environments on the open internet, including connected TV.

Outbrain shares trade on the Nasdaq with a market cap of $233.5 million. The deal will be a leveraged buyout as Outbrain had $232 million in cash and investments at the end of the first quarter. The company has raised $750 million in financing from Goldman Sachs, Jefferies and Mizuho Bank.

Altice bought Teads in 2017 for $307 million. In 2021, Teads sought a $3 billion IPO, but ultimately abandoned the plan.

This article was published in Globes, Israeli Business News – en.globes.co.il – on August 1, 2024.

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