Ad-Tech Providers Rubicon Project and Telaria Merge With a Focus on Streaming TV

With $150 million in cash on hand, the combined companies say they will consider other strategic moves

Roku’s streaming TV service on a Sharp television. The merged advertising-technology companies Rubicon Project Inc. and Telaria Inc. are banding together to capture more ad dollars from streaming TV. Photo: Roku/Associated Press

香蕉视频苹果下载Two advertising technology companies known for providing tools for publishers are banding together to capture a greater share of advertising dollars on streaming television and to better compete with technology giants such as -owned Google.

香蕉视频苹果下载On Thursday morning, publicly traded and announced a stock-for-stock merger that will create a company with a combined $217 million in revenue for the 12 months through Sept. 30, up 32% year-over-year.

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Rubicon Project is profitable, and Telaria expects to achieve profitability for the first time this year, said the chief executives of both companies.

香蕉视频苹果下载Following the merger, which is expected to close in the first half of 2020, Rubicon stockholders will own approximately 52.9% of the diluted shares of the combined company, while Telaria stockholders will own the remaining 47.1% stake.

香蕉视频苹果下载Rubicon President and Chief Executive Michael Barrett will become CEO of the combined company, which doesn’t yet have a name. Telaria Chief Executive Mark Zagorski will serve as president and chief operating officer.

Mr. Barrett and Mr. Zagorski described the deal as the bringing together of complementary services. Los Angeles-based Rubicon’s ad exchange enables publishers to offer their display, video, audio and mobile inventory for advertisers to bid on and buy in an automated fashion.

香蕉视频苹果下载Telaria is known for serving video publishers, and more recently has focused its attention on the growing advertising market on internet-connected TVs. By teaming up, the combined company can offer publishers a solution that spans all ad formats, the executives said.

香蕉视频苹果下载Streaming TV will be a priority for the combined company as cord-cutting continues to rise and more people spend time watching video on internet-connected TV sets. More of that viewing is also happening inside ad-supported apps, said Mr. Zagorski.

Streaming video ad revenue on TV screens in the U.S. is expected to hit $4.4 billion in 2020, up from $3.4 billion last year, according to a forecast by ad-buying group .

In the first half of 2020, Telaria expects more than 50% of its revenue to come from advertising on internet-connected TVs, Mr. Zagorski said. The company’s clients include streaming services such as Hulu LLC, Sling TV LLC and Pluto TV.

香蕉视频苹果下载“The big meatball in the U.S. is the $70 billion in linear TV spend,” Mr. Zagorski said, referring to the traditional TV ad business. “What this merger does is it gives us the fuel to attack that in earnest as [linear TV spending] starts to roll over into connected TV.”

Rubicon and Telaria expect to save between $15 million to $20 million annually by cutting costs such as redundant vendor contracts, Mr. Barrett said.

With $150 million in cash on hand and no debt as of Sept. 30, the companies will consider other strategic investments or acquisitions once the deal closes, the executives said.

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Write to Sahil Patel at Sahil.Patel@wsj.com

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