In a seismic shift for the digital advertising industry, Outbrain announced its plans to acquire Teads, the global omnichannel video platform, in a deal valued at approximately US$1 billion (RM4.5 billion).
This strategic merger promises to create a powerhouse in the open internet advertising space, combining Outbrain’s AI-driven performance technology with Teads’ leading video and branding solutions.
A New Era of Full-Funnel Advertising
The union of these two digital advertising titans aims to address a critical gap in the market.
By merging Outbrain’s strengths in prediction and performance with Teads’ expertise in omnichannel video, the combined entity will offer advertisers a comprehensive full-funnel solution.
This end-to-end platform is set to revolutionise how brands engage with consumers across various touchpoints, from connected TV to online shopping.
“This is a transformative transaction to establish a true end-to-end, full-funnel platform for the open internet,” said David Kostman, CEO of Outbrain.
“The combination of our highly-complementary offerings accelerates our vision to become the preferred partner to deliver meaningful brand outcomes across premium, quality media environments — while scaling the industry-leading offerings Teads is known for,” he added
Teads Leadership Sees Vast Potential
Bertrand Quesada, Co-Founder and Co-CEO of Teads, echoed this sentiment, highlighting the merger’s broader implications.
“This strategic combination presents vast new opportunities for the advertising industry at large. We’ve built a world-class team at Teads that has focused on driving the best video and branding outcomes, and in the last several years have successfully brought those strengths to CTV,” he said.
His counterpart, Teads Co-CEO Jeremy Arditi, added, “By joining our expertise in omnichannel video with Outbrain’s strengths in prediction and performance, we are poised to provide our customers and partners with more value than ever before.”
“Having known the Outbrain team for a decade, we know we’re creating an amazing combined company focused on innovation and excellence,” he continued.
Breaking Away from Traditional Metrics
In a bold move, the merged company plans to shift focus away from traditional metrics like views and impressions.
Instead, it will prioritise more tangible outcomes such as attention, deep engagement, and e-commerce conversions.
This approach aims to provide advertisers with a more meaningful measure of their marketing efforts across premium environments on the open internet.
Expanding Reach and Capabilities
The combined strengths of Outbrain and Teads are impressive:
A vast network reaching over 2 billion monthly consumers across 50+ markets
Advanced data capabilities processing over 1 billion predictions per second
Innovative ad experiences crafted by creative studio teams
This expanded toolkit positions the new entity to compete effectively in the growing US$175 billion open internet advertising market.
A Win for Media Owners
The merger isn’t just good news for advertisers.
Media owners stand to benefit from enhanced monetisation opportunities across diverse advertiser budgets.
This influx of revenue could provide a much-needed boost to premium journalistic and entertainment outlets struggling in the digital age.
Financial Details and Market Impact
The acquisition, expected to close in Q1 2025, involves a complex financial structure:
US$725 million upfront payment
US$25 million deferred cash payment
35 million shares of Outbrain common stock issued to Altice
US$105 million in convertible preferred equity
This strategic move has been unanimously approved by the boards of both companies, signalling strong confidence in the merger’s potential.
Dawn of A New Chapter in Digital Advertising
As the digital advertising landscape continues to evolve, this merger between Outbrain and Teads represents a significant milestone.
By combining their strengths, the new entity aims to offer a more effective, measurable, and engaging advertising solution for the open internet.
The success of this venture could potentially reshape how brands interact with consumers online, providing a compelling alternative to walled garden platforms.
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