Taboola today announced that it has agreed to acquire e-commerce media platform Connexity from Symphony Technology Group for $800 million. The company will pay for the deal with $260 million in cash, $300 million in debt, and the rest through new shares.
Helping retailers to acquire new customers from thousands of publishers, Connexity works with more than 1600 brands and merchants such as Walmart, Wayfair, Macy’s, and eBay, and over half of the top 100 publishers globally including Vox Media, DotDash, and Meredith. The company drives 150 million monthly visits to retailer websites and generates more than 1 million monthly transaction events on publisher sites, Instagram, and other social networks and search engines.
“Today, our vision of helping brands easily connect with customers and helping publishers grow gets supercharged with Taboola,” said Bill Glass, CEO of Connexity. “This is a shared vision for both companies, which makes this deal a natural fit and a huge win for both of our customer sets. I want to thank all of the team members as well as our loyal customers and partners who have helped Connexity pioneer its space and grow over the past 20 years.”
Taboola expects the combined company to have ex-TAC gross profit of over $500 million for the fiscal year ended March 31, 2021, with $185 million of adjusted EBITDA for the period, with both figures growing 20% in 2021 versus 2020.
The acquisition of Connexity aligns with Taboola’s “Recommend Anything” growth strategy to introduce new types of recommendations and enter new segments, while leveraging its significant scale and recommendations platform to deliver even greater value to its 9,000 digital property partners, 13,000 direct advertisers and 500 million daily active users.
“The rise of social commerce proves the value of commerce alongside content, and with Connexity, Taboola is primed to bring this value to the open web. e-Commerce is the future of the open web, consumers will be buying outside of Amazon, on publishers’ sites next to trusted editorial content a lot more than they are today. Amazon has millions of merchants, but merchants mainly have Amazon. That changes today. Combining Taboola and Connexity’s technologies is one step forward in creating an alternative to walled gardens,” said Adam Singolda, CEO and founder, Taboola.
Taboola began trading on the Nasdaq in June following its merger with the special acquisition company ION Acquisition Corp.1. The company, which serves over 13,000 advertisers using its network to reach more than 500 million daily active users, reported a revenue of $303 million in the first quarter of 2021.
Taboola’s content recommendation rival Outbrain also announced this month that it has publicly filed for an initial public offering at what’s likely to be about a $2 billion valuation. It also has raised $200 million in funding from Boston-based hedge fund Baupost Group.