- Rubicon Project and Telaria have announced an all-stock merger in order to better position the two companies for the connected TV market
Rubicon Project and Telaria have announced an all-stock merger in order to position the two companies for the connected TV market. Rubicon’s stockholders will own 52.9% of the combined company while Telaria stockholders will own the remaining 47.1%.
Rubicon Project president and CEO Michael Barrett is going to head up the combined company, which will be closing in the first half of 2020. And Telaria chief executive officer Mark Zagorski will be the president and chief operating officer. David Day will be the Chief Financial Officer. And Telaria board member Paul Caine will be Chairperson of the Board of Directors of the combined company. The full board will consist of 9 members, of which 4 are existing directors from each company along with CEO Michael Barrett.
Going forward, Rubicon Project and Telaria will have over 600 employees and contractors in 19 cities as part of the merger. And the combined company will have diversified revenue streams, substantial Adjusted EBITDA and a strong balance sheet with approximately $150 million in cash and no debt — which is based on the September 30, 2019 balances. Plus the merger will create both revenue and cost synergies with an expected annual run-rate cost of approximately $15-20 million.
The combined company will benefit from Rubicon’s scale and Telaria’s capabilities in the connected TV (CTV) market. And the combined company will essentially create the largest independent sell-side platform (SSP) in adtech.
“The combination of Rubicon Project and Telaria will establish the world’s largest, independent sell-side advertising platform with scale, capabilities and solutions unmatched by the competition,” said Barrett. “This transformative combination builds on our commitment to trust and transparency and accelerates our strategy to provide buyers and sellers with a single path to every format and channel including CTV. We could not be more excited about the future as two individually strong industry leaders with complementary assets and cultures come together to create a market leader that we believe will generate significant opportunities for our employees, customers, partners, and stockholders worldwide.”
Telaria is one of the leading SSPs for CTV inventory and it competes against companies like SpotX. During Telaria’s third-quarter earnings report, the CTV revenue hit $7.3 million (44% of total revenue).
“Our businesses are highly complementary, and when combined, are a powerful, strategic alternative to the walled gardens, which have been frustrating both buyers and sellers due to their lack of transparency, innovation bottlenecks, and conflicted business models,” added Zagorski. “The two companies will provide more technology resources, a broader geographic footprint and deeper financial assets to attack the growing opportunity created by the shift from linear viewing to CTV to the benefit of our customers and in support of a thriving open internet. For our stockholders, we believe this merger allows us to accelerate our growth, while providing additional resources to increase investment and continue to scale our industry-leading CTV technology. For our employees, this is an opportunity for development and to fully realize the potential of what we have built these past few years in a scaled, omnichannel platform.”
LUMA Partners LLC and Needham & Company, LLC are serving as the financial advisors to Rubicon Project, and Gibson, Dunn & Crutcher LLP is serving as its legal advisor. And RBC Capital Markets, LLC is serving as financial advisor to Telaria and Cooley LLP is serving as its legal advisor.
