Berlin, Germany-based RNTS Media N.V. (FRA: RNS)(XETRA), the parent company of Fyber GmbH, a mobile advertising technology platform, agreed to acquire Tel Aviv-based Inneractive Ltd., a mobile RTB-based ad exchange focused on display, native and video ads, for up to $72 million, consisting of $46 million in cash, and $26 million in earn-out and retention milestone payments over the next three years.
Founded by Ziv Elul and Offer Yehudai in 2007, Inneractive is headquartered in Tel Aviv, with offices in New York, San Francisco and London. The startup had raised $11.5 million in 3 rounds of funding from Evergreen Venture Partners, Kreos Capital, billionaire Idan Offer, Andy Fruchter, Ehud Hillman, Moshe Teumin and Mody Kydon. Inneractive was recently recognized as one of the fastest growing technology companies in the Deloitte Technology Fast 500 EMEA, and a Deloitte Israel 2015 Technology Fast50 winner. Its product offering and technology is highly complementary to that of Fyber.
Inneractive’s platform currently serves over 630 million MAUs spanning 180 countries and empowers mobile publishers to realize the full potential of their inventory by providing technologies for the buying and selling of mobile ads. The Inneractive programmatic platform for display, native and video ads is comprised of a mobile Supply Side Platform (SSP), a Private Marketplace and an Open Ad Exchange. Inneractive grew gross revenue by more than 100% to $43.2 million and was profitable in 2015. It is aiming to double its revenues again over the next two years.
The deal will make RNTS one of the largest, independent mobile supply-side platforms globally with one of the most advanced product offerings across mediation, exchange and ad serving, covering all ad formats.
“This is another milestone for RNTS on our path to building the leading supply-side platform for the mobile app economy. By playing an active role in industry consolidation we intend to secure a lasting competitive edge,” said Andreas Bodczek, CEO of RNTS Media.
“Following on from our acquisitions of Falk Realtime and Heyzap, Inneractive delivers significant additional scale and programmatic capabilities to enable our publishers to generate revenue even more effectively, and our advertising partners to access a substantially broader audience across important digital verticals. Having now delivered on our commitment of two important acquisitions following the convertible bonds, we are confident that the revenue run-rate for the enlarged group by year-end 2016 will surpass EUR 200 million,” Bodczek added.
Ziv Elul will join the RNTS executive board upon closing. Inneractive will be run largely independently within RNTS Media and continue to pursue its growth plan. At the same time, RNTS expects to generate important revenue synergies for the combined group by monetising Fyber’s audience through Inneractive’s platform, combining the liquidity of both exchanges and collaborating on innovations to support mobile video growth.
“This is a great achievement for Inneractive and we are very proud of our amazing team,” said Ziv Elul, co-founder and CEO of Inneractive. “We have been working with Fyber and its strong executive team for a long time and are excited to join the RNTS family. We are passionate about the potential of our future together, excited about the synergies and confident in our ability to work together to offer publishers the most comprehensive tech stack in the industry.”
The acquisition of Inneractive is expected to be completed in Q2 of 2016 after the satisfaction of certain customary closing conditions and expiry of the statutory 50 days waiting period for mergers in Israel.
The initial consideration will be funded from proceeds of RNTS convertible bonds issued in July 2015, and additional funds will be raised as needed. RNTS Media agreed to pay a break fee of $8 million if it is not to complete the transaction.
Fyber is an independent advertising technology company that connects app developers and media companies with advertisers through the power of technology across every device. Its SSP, Ad Serving, Ad Exchange and Mediation products empower thousands of the world’s leading app developers and publishers to generate business-critical revenue streams and serves over 500 million MAUs globally. Its parent company RNTS Media was founded in 2010, is headquartered in Berlin, Germany, and listed on the Prime Standard of the Frankfurt Stock Exchange. The company operates in Germany, the South Korea, the United States and Japan, and its subsidiaries include Falk Realtime and Heyzap Inc.