French advertising giant Publicis Groupe bought a 20 per cent stake in Israel-based digital advertising group Matomy Media for 227p per share yesterday, with an option of buying another 4.9 per cent.
The deal was done below Matomy’s Friday closing price of 238p and the Israeli group’s founding shareholders were given permission by the broker to sell down their shareholding before the expiration of the lock-up as part of the deal.
Matomy’s shares fell 0.2 per cent yesterday on news of the deal to 237.50p, valuing Publicis’ 20 per cent stake at around £42.6m.
As major companies shift more of their spending to online marketing, advertising agencies such as Publicis and its larger rivals WPP and Omnicom have been snapping up startups to gain technological know-how.
The deal also shows how Publicis is seeking to boost growth after the failure in May of its mega-merger with Omnicom hurt second-quarter performance.
“Our vision is to build the best performance-based media company in the world, and with Publicis Groupe becoming our largest shareholder, we will be able to create a more mature and sustainable ecosystem, providing marketers with an unprecedented ability to accurately engage, acquire and retain customers,” said Matomy chairman Ilan Shiloah.
Matomy, which counts American Express and HSBC among its clients, specialises in so-called performance-based advertising that allows big companies to track the effectiveness of their online marketing.
It only earns a fee from advertisers when it achieves certain pre-defined measurable results, such as sales or mobile app installations.
“We make it a priority to invest in the brightest and most promising talent and technology that will give our clients around the world unrivalled access to these services,” said Publicis chairman and chief executive Maurice Levy.
“We have pioneered and invested in new technology, open platforms and partnerships.”