Somoto, the software distribution and targeted app ad solutions provider, has just acquired Israeli digital ad network Terser Tude, focussed on mobile video ad solutions. Terser Tude helps marketers deliver and monetise their premium video content and in-stream video ad campaigns on mobile devices and the web.
Terser Tude offers in-app monetisation solutions for app developers
Founded in 2014, the relatively new company now has 10 active clients and multiple partnerships with ad agencies and digital exchanges. Revenue for the first 10 months of 2015 were NIS 11.8m, with operational profits of NIS 2.5m – 22% of its revenue. According to estimates from Somoto, Q4 2015 revenue is expected to reach NIS 9m with an operating margin of 23% revenue.
Ben Giron, CEO, Somoto, said:
“The field of video advertising, especially video on mobile is currently experiencing a significant transition of advertising budgets from television to the Internet. The Terser acquisition is consistent with the growth strategy of Somoto in the mobile field, where we see a significant growth engine, in particular in the field of video, along with our return to growth in the field of Apple Mac and our increasing profitability. The technology and unique knowledge of Terser brings impressive levels of revenue and profitability, and established strong relationships with advertisers and quality advertising space providers, which we believe have the potential for further significant growth. I congratulate the employees of Terser in joining our group. Their experience and knowledge, combined with our capabilities and marketing technologies, will be the basis of Somoto’s capabilities in the area of mobile video.”
The deal includes a transaction consideration of NIS 14m (around $3.6m) in cash and shares, depending on Terser Tude’s net profits in 2016. Upon closing the deal, a total NIS 2.1m are being paid and Terser will become a fully-owned subsidiary of Somoto. Terser staff will be overseeing Somoto’s mobile and video efforts upon full integration of the company.
As the digital advertising market continues to grow, traditional ad budgets are shifting towards newer channels such as mobile advertising. Giron added:
“We continue to diversify the sources of our revenue and growth areas, so that in 2016, about 50% of Somoto’s consolidated revenues will come from the mobile video space, through implementing our strategic plan in expanding through mergers and acquisitions.”