Magnate stock was up more than 26% after the deal was announced. Magnate helps publishers of websites, apps, CTV channels or other digital media properties sell space across their media. Now Magnate maybe even more set for a standout 2021 as it rides on the back of the booming CTV sector. The acquisition of SpotX, a video supply-side platform, from parent company RTL Group should help deepen that strategic play.

The companies said SpotX’s purchase price consists of $560 million in cash and 14 million shares of Magnate stock, for a total of $1.17 billion based on the closing price of Magnate stock as of Thursday.

SpotX was a competitor of Magnate before the acquisition, along with companies like PubMatic, which recently went public. Other competitors include Google, which operates at multiple links in the supply chain, Comcast-owned FreeWheel, Index Exchange and OpenX.

The deal is expected to close in the second quarter of this year. The company said it will be the largest independent CTV and video ad platform in the programmatic space once the deal closes. The company does serve clients in other formats, including display, mobile and audio.

CTV is a smaller piece of Magnate’s overall business, but a big growth opportunity. (A Susquehanna note in December wrote that about 80% of its revenue was from desktop and mobile, but that “CTV is the crown jewel.”) Connected TV has been a white-hot sector in the pandemic, which dramatically accelerated what industry experts thought would be a multi-year transition to CTV. The more people home and streaming ad-supported movies and shows, the more opportunities there are for ad tech partners to show them ads on platforms.

For its part, Magnate has said that its total CTV revenue grew over 50% year over year in its third quarter of 2020. Magnate also said that the number of advertisers using its audience targeting features grew two and a half times between its third quarter in 2019 to the same period in 2020.

Magnate says it has an exclusive relationship with Hulu and its owner Disney. It also works with other services like Sling TV, Fubo TV, Philo and Pluto TV, which is owned by ViacomCBS. It also partners with broadcast channels on its CTV app offerings, including Fox and Discovery.

Though historically advertisers worked with a slew of supply-side partners, there’s been a trend of limiting that spend to fewer partners. Advertisers and agencies are looking to do business with fewer supply-side platforms to avoid inefficiencies and the potential of fraud. Buying competitors to increase its scale and inventory could be a way for Magnate of giving itself a competitive advantage over its peers.

Nominations are open for the 2021 CNBC Disruptor 50, a list of private start-ups using breakthrough technology to become the next generation of great public companies.

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.

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