Adtech M&A has started to pick up the pace in recent weeks.
Transaction volume in the third quarter increased 118% year-over-year and 26% quarter-over-quarter, according to data from Luma Partners, Axios reports. This is the highest rate since the first half of 2022.
Driving deal growth is an increase in digital ad spending – recent revenue from some public ad tech companies like The exchange office and tech giants like Google have been strong, coupled with a sense of “cautious optimism” as we approach 2024 after a difficult few years, said Bill Wise, CEO of Mediaocean.
Of course, many deals took place in 2024, but most of them were rational consolidation deals characterized as opportunistic deals at reasonable or low valuations.
But what has accelerated recently is the number of more strategic transactions. These deals focus on the future of digital advertising and can lead to higher valuation multiples, said Conor McKenna, a partner at investment firm Luma. In other words, strategic agreements mean a healthy market.
McKenna expects there to be more in 2025. “These will focus on key themes such as Connected TV And trade media and critical capabilities related to optimizing performance, addressability, creation and measurement,” McKenna said.
Another force tying these deals together is the desire to evolve, more robust omnichannel capabilities, particularly in video, and a trend toward lower-funnel conversion optimization that provides more granular ROI of advertising spending, said Mark Wright, head of the mergers and acquisitions advisory practice at Prohaska Consulting. .
“As this acceleration occurs, the industry could very well witness a frenzied game of musical chairs as more and more players jump into the M&A game, fearful of being left alone when the music will stop,” Wright said. “Our industry is growing.”
ADWEEK has compiled a list of the big M&A deals this year and what they tell us about the state of the industry.
January: LiveRamp buys Habu for $200 million
Cast your mind back to January, when the weeks seemed long and the endless possibilities of the year stretched ahead. These possibilities would have seemed very bright to LiveRamp, which acquired Habu, combining two titans of the data cleanroom world.
Historically, LiveRamp has focused more on helping advertisers on the open web, while Habu targeted black box systems like Google and Meta. LiveRamp expects acquisition to generate bargain $18 million of turnover during its 2025 financial year.
Privacy-preserving technologies are a smart bet, and major brands and agencies have been investing in cleanrooms for the past few years. But we could see a winnowing: the FTC in November warned companies that it is targeting data cleanrooms because they are not as clean as their name suggests.
February: Vizio buys Walmart for $2.3 billion
One of the most valuable transactions of the year, Walmart hopes that having Vizio under its wing will help it seriously compete with Amazon.
Vizio TV technology, particularly its automatic content recognition data, collects data on viewing habits, advertising preferences and purchasing behavior. This opens up numerous opportunities for the retailer in the form of targeted advertising, shoppable formats and a more holistic offering for advertisers. All of this will be tied to Walmart’s first-party data and in-store activity, not to mention its retail media arm, Walmart Connect, further blurring the lines between CTV and retail media.
June: Equativ buys Sharethrough for an undisclosed amount
Equativ, a sourcing platform based in Paris and New York, has acquired Sharingan advertising exchange with a strong North American presence and specialized in native advertising. At the time of the announcement, Sharethrough was valued between $100 million and $125 million, and the combined recurring net revenues of the two companies will be more than 200 million dollars.
The merged company aims to give the industry greater differentiated type of SSP, while competing with walled gardens.
It’s been a busy year for Equativ, which also bought the retail technology platform Kamino in September to strengthen its capabilities in retail media. Terms were not disclosed.
August: Outbrain buys Teads for $1 billion
The first unicorn deal in the sector in several years was exciting news, even though Teads had been in the market for some time, first hire Morgan Stanley will give its opinion on the sale in September 2023.
The merger changed the makeup and scale of content recommendation company Outbrain, creating a broad advertising platform that combines its technology with Teads’ video and branding solutions.
Several parties considered purchasing Teads and decided against purchasing it, and some have calculated $1 billion as an opportunistic price for Outbrain.
The merger provides a strong point of differentiation between Outbrain and its main rival, Taboola. Outbrain is focused on improving demand-side video operations while Taboola has doubled down on its display and performance marketing, according to sources speaking to Digiday.
October: Zeta Global buys LiveIntent for $250 million
In a nod to the growing importance of first-party data, Zeta Global, A AI-optimized marketing cloud platform that uses AI and first-party data to help brands analyze customer actions and behavior before purchase, access LiveIntent assets, publisher network with 2 000 relationships with publishers and identity graph. LiveIntent’s technology helps publishers sell ads in email newsletters with an identity graph including 235 million hashed email addresses.
Several weeks after the announced acquisition, LiveIntent 35 people were made redundantroles that “duplicated existing Zeta resources.”
November: Mediaocean buys Innovid for $500 million
Last month’s big strategic acquisition news – ad solutions platform Mediaocean will merge adtech platform Innovid with Mediaocean’s ad serving subsidiary, Flashtalking – had onlookers excited about the new entity’s potential to challenge Google’s adtech supremacy.
Mediaocean says the deal will give advertisers more control over their data and how they spend their advertising budgets.
With the majority of ad spend concentrated on Google, Amazon and Meta, Mediaocean’s Wise believes there is “power in independence, power in neutrality and power in scale,” he said. told ADWEEK. Wise believes that, based on recent conversations he’s had since the announcement, there is growing evidence that “big marketers don’t always want to work with Google.”
December: Experian buys Audigent for an undisclosed amount
In December, data giant Experian announcement she welcomed data and identity enablement company Audigent into her family. In doing so, the company showed how adtech’s latest darling, curation– or the process of selecting quality inventory to target specific audiences – influences the market.
Audigent has been a leader in curation, moving audience targeting to the sell side as the slow disappearance of third-party cookies makes targeting large audiences via DSPs less viable. The companies have been working together since 2022, including integrating Experian data into Audigent SmartPMP. Audigent was launched in 2015 and its executives had apparently been looking for an exit for some time.
But the recent wave of brands and tech companies offering curation products is adding even more heat to the buzz.
