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Sizmek to acquire ad tech firm Rocket Fuel for $145 mn

Sizmek Inc. has entered into a definitive acquisition agreement with Rocket Fuel Inc., a predictive marketing platform that uses AI to anticipate optimal consumer response to messaging. Under the terms of the agreement, an affiliate of Sizmek, backed by Vector Capital, will commence a tender offer for all of the outstanding shares of Rocket Fuel common stock for $2.60 per share in cash, which represents an enterprise value for Rocket Fuel of approximately $145 million.

Collectively, Sizmek and Rocket Fuel service more than 20,000 advertisers and 3,600 agencies to global audiences in over 70 countries, and service a client base comprised of the world’s most recognized brands and agencies.

“The acquisition of Rocket Fuel brings omni-channel creativity and AI-enabled decisioning together under one roof, providing our clients with a self-service predictive marketing platform that optimises campaigns across the entire media plan. This is the next logical step in marketing automation–media optimisation and full creative optimization combined, bringing together the context and the creative for the optimal consumer experience. The result is advertising that is deeply personalised, highly intuitive, and AI-enabled for peak performance, redefining the boundaries of creative possibility and media execution,” said Dr. Mark Grether, Executive Chairman of Sizmek.

“By integrating with Sizmek, we’re effectively combining the powerful brand-building insights delivered via our Predictive Marketing Platform’s Decision Engine, with Sizmek’s creative optimization platform. This union creates one integrated, full-funnel solution to enable agencies and their brands address key performance objectives across paid, owned and earned media. This transaction accelerates our global expansion efforts in more than 70 countries, which empowers us to provide agencies and brands with more tools, exceptional service and support worldwide,” said Randy Wootton, Chief Executive Officer of Rocket Fuel.

Upon completion of the transaction, Rocket Fuel will become a privately-held company. The transaction, which is expected to close in the third quarter of 2017, is conditioned upon satisfaction of a minimum tender offer condition, regulatory approvals and other customary closing conditions. The Rocket Fuel board of directors unanimously approved the acquisition agreement. Stockholders holding approximately 24 per cent of Rocket Fuel’s common stock have entered into a tender and support agreement with Sizmek pursuant to which such stockholders agreed to tender all of their shares into the tender offer. This agreement terminates if, among other things, the Rocket Fuel board of directors withdraws its recommendation in favor of the tender offer pursuant to the terms of the acquisition agreement.

Needham & Company, LLC is serving as financial advisor to Rocket Fuel. Wilson Sonsini Goodrich & Rosati, Professional Corporation is acting as Rocket Fuel’s legal advisor. Kirkland & Ellis LLP is acting as Sizmek’s legal advisor.

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