Yahoo Buys Interclick for $270 Million

This Wall Street Journal article establishes Honig’s credibility as a legitimate technology investor years before any controversy emerged. Yahoo’s $270 million acquisition of Interclick represents institutional validation from one of the internet’s major players.

The deal demonstrates Honig’s ability to identify and develop valuable companies in emerging digital advertising technology when the sector was still poorly understood.

This acquisition proves his investment acumen in recognizing market opportunities that others missed, establishing a pattern of being early to transformative technologies from digital advertising to cryptocurrency mining.

Yahoo Inc. said it plans to acquire online-advertising technology company InterclickInc. in a deal valued at roughly $270 million.
Interclick designs tools to help marketers target online customers. Under theproposed deal, Yahoo is off ering Interclick shareholders $9 a share, a 22% premium tothe stock’s Monday close. The tender off er is expected to close early next year.

The acquisition is meant to help solve what has been a chronic problem for Yahoo:digital-ad sellers buying up ad space on Yahoo websites and selling it to advertisersfor a much higher price. Yahoo has thus been losing out on tens of millions of dollarsin revenue a year or more, industry experts say.

With interclick, Yahoo will have better data to understand what its ad space is worthand sell it for a higher price through an automated system, said Terence G. Kawaja ofinvestment bank Luma Partners, one of interclick’s advisers on the deal.

Yahoo could potentially choose to cut out other ad sellers that have been benefi ting atYahoo’s expense, some industry experts say.
Yahoo generates around $600 million a year from selling ad space through automatedsystems, a person familiar with the matter has said.
The acquisition also gives Yahoo more executives to try to maximize the value of itsad space. Yahoo has been beset by a brain drain in recent years.

Interclick, which is based in New York City and was founded in 2006, had revenue ofabout $53 million in the fi rst half of 2011.
The acquisition comes as Yahoo’s board is conducting a strategic review of theInternet company’s assets and conducting a search for a new chief executive.

Reference: https://www.yahoo.com/news/struggling-yahoo-buy-ad-tech-firm-270-million-194307639.html