Zeta Global to acquire LiveIntent

Zeta Global, the AI-Powered Marketing Cloud, has entered into an agreement to acquire LiveIntent, a pioneer in people-based marketing, for $250 million. The announcement, made on October 8, 2024, marks a significant move in the digital marketing landscape, combining Zeta's AI-driven platform with LiveIntent's first-party identity solutions and publisher network.

The acquisition, expected to close in the fourth quarter of 2024, involves a total consideration of $250 million, subject to customary adjustments. The payment structure includes $77.5 million in cash-on-hand and $172.5 million in common stock at closing. Additionally, the agreement provides for a potential earnout of up to $75 million over three years, tied to Adjusted EBITDA growth and margin expansion targets.

According to David A. Steinberg, Co-Founder, Chairman, and CEO of Zeta Global, the acquisition aligns with Zeta's four guiding M&A principles:

1. Complementary platform integration
2. Immediate accretion to earnings
3. Cross-selling opportunities
4. Potential for accelerated growth

Enhancing identity resolution capabilities

LiveIntent's identity graph, which processes over 235 million unique hashed email addresses per month, will be integrated into Zeta's Data Cloud. This integration is expected to significantly enhance Zeta's identity resolution solutions, providing a more comprehensive and precise foundation for people-based marketing programs.

Expansion into Publisher Monetization

The acquisition brings LiveIntent's network of 2,000+ premium publishers into Zeta's ecosystem, including relationships with eight of the top 10 largest publishers in the Comscore rankings. This expansion allows Zeta to enter the publisher monetization business and launch a new product offering called the Publisher Cloud.

Mobile and Retail Media Solutions

Zeta's recently launched mobile and retail media products are expected to benefit from LiveIntent's capabilities. LiveIntent powers millions of mobile experiences per day and has recently entered the retail media ecosystem, aligning with Zeta's strategy to deliver innovative offerings to retailers and brands.

Financial Impact and Market Position

The transaction is anticipated to be immediately accretive to Zeta's earnings profile. Zeta has reaffirmed its third quarter 2024 guidance, projecting revenue of at least $255 million and Adjusted EBITDA of at least $50.2 million.

Industry Perspective

Matt Keiser, CEO of LiveIntent, expressed enthusiasm for the merger, citing Zeta's growth and proven ability to deliver impact to global customers. The combined entity aims to provide marketers and publishers with enhanced capabilities to reach customers across multiple channels.

Transaction Advisors

Several firms provided advisory services for this transaction:

• Roth Capital Partners, LLC: Transaction advisor to Zeta
• Citigroup Global Markets Inc.: Capital markets advisor to Zeta
• Latham & Watkins LLP: Legal advisors to Zeta Global
• Houlihan Lokey: Financial advisor to LiveIntent
• Lowenstein Sandler LLP: Legal advisor to LiveIntent

Market Impact and Future Outlook

The acquisition of LiveIntent by Zeta Global represents a significant consolidation in the AI-powered marketing sector. As companies continue to prioritize first-party data and seek more efficient marketing solutions across the customer lifecycle, this merger positions the combined entity to capitalize on these trends.

Key Facts

• Acquisition value: $250 million
• LiveIntent's identity graph: 235 million unique hashed email addresses per month
• Publisher network: 2,000+ premium publishers
• Zeta's Q3 2024 guidance: At least $255 million in revenue, $50.2 million in Adjusted EBITDA
• Expected closing: Fourth quarter of 2024