Taptica Takes Majority Holding in Japanese Firm

Israel-based digital ad platform Taptica has acquired a 57 percent share of Japanese mobile ad tech firm Adinnovation Inc. (ADI), for up to $5.7m.

Established in 2010, ADI specialises in mobile app and mobile advertising marketing promotion, implementation, management, tracking, and media site monetisation. Having raised funding in the last two years, it has begun expanding into China, Southeast Asia and other markets, and in 2015 it opened an office in Moscow.

The buy is being funded out of Taptica's own cash resources, and continues its expansion into Asia following the launch of its office in Seoul last year. The company says it already has a strong presence in China and expects Japan to be 'the next key growth market for mobile advertising'. The two companies have been working together under a partnership agreement for the last few months.

Taptica says it intends to establish and grow its presence in ten hubs worldwide in the next three years: Russia, China, Germany, San Francisco, New York, Korea, Japan, India, South America and the UK. It opened a London office in February this year.

Three quarters of the $5.7m will be payable on closing and the remainder after a year subject to meeting targets. Taptica then has an option to buy the remaining shares within the next three years. The buy is expected to close next month and should add more than $5m to Taptica's FY 2017 revenues and $0.5m to its adjusted EBITDA.

Hagai Tal, CEO of Taptica (pictured), says the company also 'expects to benefit from a number of strategic synergies and mitigate the costs and risks we would have incurred to penetrate a market such as Japan organically', making the deal 'a key milestone in the continued international expansion of Taptica'. Hiromitsu Ishimori, President and CEO of Adinnovation, comments: 'Japan's advertising industry has been fairly isolated from global collaboration efforts. The opportunity to work with Taptica in a larger capacity is a great advantage to strengthening the Japanese market's ability to look outside of Japan'.

Web sites: www.adinnovation.co.jp/en and www.taptica.com .