Tremor completes $239m acquisition of Amobee

Video, data and connected television advertising technology company Tremor International announced the closing of its acquisition of global ad platform Amobee on Tuesday.

The AIM-traded firm said the transaction was expected to generate accretive contribution ex-traffic acquisition costs (TAC) and adjusted EBITDA within the first 12 months.

It said it would expands its global market presence, and create “one of the largest” connected TV and video end-to-end platforms and offerings in the market.

Tremor reiterated its expectation to achieve run-rate operating cost synergies of around $50m on a combined pro forma basis following completion of the integration, with “meaningful synergies” expected by the end of 2022 and the majority expected by the end of 2023.

The board said the consideration of $239m, as adjusted, was funded through a combination of existing cash resources, and around $100m from a new $180m secured credit facility.

It said the new facility consisted of a $90m secured term loan A drawn at closing, and a $90m revolving credit facility, of which $10m was drawn at closing.

The remaining $80m capacity on the revolving credit facility would provide Tremor with “ample” liquidity, which it said could be used for future strategic investments and initiatives alongside existing surplus cash resources.

For the 12 months ended 30 June, Amobee generated a preliminary unaudited contribution ex-TAC of about $150m, excluding the results from its email marketing platform which was not part of the acquisition.

Looking at its updated combined company financial guidance, Tremor said it expected a full-year 2022 contribution ex-TAC of around $330m and adjusted EBITDA of about $160m.

The full-year 2023 contribution ex-TAC, meanwhile, was expected to be $500m, with adjusted EBITDA of about $200m.

“We are pleased to complete the strategic acquisition of Amobee, which we anticipate will increase our global market presence, significantly enhance and expand our technology capabilities, add new linear TV capabilities and cross-selling opportunities, and enrich our growth and competitive positioning within the industry,,” said Tremor’s chief executive officer Ofer Druker.

“We appreciate the ongoing support of all our stakeholders as we begin integrating Amobee into our operational strategy and technology offering.

“We will prioritise capitalising on growth opportunities created through the acquisition, while working to quickly realise cost synergies and efficiencies, and remain committed to unlocking long-term value for our shareholders.”

At 1110 BST, shares in Tremor International were down 0.06% at 339.8p.

Reporting by Josh White at Sharecast.com.