Nasdaq-listed Integral Ad Science lobs $50m bid for Adveritas

Ad fraud prevention company Adveritas (ASX: AV1) is the latest ASX-listed tech stock to be targeted in a global buying-spree after Integral Ad Science (Nasdaq: IAS) launched a bid valuing the company at more than $50 million.

Describing itself as a global leader in digital media quality, Integral Ad Science has a US$1.52 billion market cap and posted revenue for the September quarter of US$79 million – up 32% on the previous corresponding period.

Integral Ad Science analyses the value of digital advertising placements and has developed technology for addressing ad fraud.

Meanwhile, Adveritas has also enjoyed soaring revenue growth as adoption of its TrafficGuard ad fraud prevention software as a service (SaaS) technology rapidly increases.

In response to media speculation, Adveritas revealed this morning Integral Ad Science had made an indicative proposal, which is under consideration.

The proposal values Adveritas at $0.11 per share, or around $51.7 million, and would be paid in cash and/or shares.

It represents a substantial premium to Adveritas’ last closing price of $0.079 on the 24 November and market cap of about $37 million.

In considering the proposal, Adveritas has appointed Gadens as an adviser and says it “will proceed to a definitive agreement if it believes a transaction should be put to shareholders for approval”.

Adveritas shareholders have been asked to take no action and cautioned there was no certainty it would proceed to a binding proposal.

Rapid adoption of TrafficGuard

Adveritas’ rapid growth continued in the September quarter, with annualised revenue up 88% to $3 million.

This was driven by key blue-chip enterprises signing on to TrafficGuard including Better Collective, Lux Escapes and Disney Streaming Services.

TrafficGuard is an omnichannel ad verification platform that helps companies combat fraud by verifying advertising engagement and blocking invalid traffic from infiltrating search campaigns.

The product has received multiple awards and has been recognised by The Drum, and the MarTech Breakthrough Awards.

Additionally, TrafficGuard is on the exclusive Google Cloud Marketplace globally allowing clients to contract through the marketplace directly.

Recent ASX-listed tech takeover offers

Adveritas is the latest takeover target out of more than a handful of ASX-listed tech stocks.

Last month, ELMO Software (ASX: ELO) recommended shareholders accept a takeover offer from leading enterprise-focused software investment firm K1 Investment Management that gave it an implied equity value of $486 million and represented a 100.4% premium to its last closing price prior to the announcement.

A bidding war has been enacted out over Nitro Software (ASX: NTO), which creates PDF software, document management and electronic signature technology.

Earlier this month, Potentia Capital issued a revised all cash offer for that valued Nitro at $1.80 per share.

However, Nitro’s board urged shareholders to reject the bid on the basis it undervalues the company and is inferior to a binding offer from global tech Alludo that valued it at $2 per share.

A wholly owned subsidiary of US realty technology company MRI Software will acquire PropTech Group (ASX: PTG) for $0.60 per share – representing a 131% premium to its closing price prior to the bid.

The acquisition values PropTech at about $93.4 million on a fully diluted basis and the board has recommended shareholders vote in favour of the transaction, stating it represents a “compelling opportunity”.

Also following the trend is Sixth Street and BGH Capital Consortium’s, via Pegasus Bidco, play for New Zealand-headquartered Pushpay (ASX: PPH) in late October.

Pushpay’s board considered the Sixth Street and BGH proposal, which gives it an enterprise value of US$933 million, the best out of “various unsolicited” expressions of interest.

Leading private equity firm Pacific Equity Partners reaffirmed its interest in acquiring ReadyTech (ASX: RDY) earlier this month.

The indicative proposal is for $4.50 per share and gives ReadyTech an enterprise value of $563 million – representing a 51% premium to its VWAP a month prior to the offer.

Tyro Payments (ASX: TYR) has confirmed an approach from Westpac Banking Corporation (ASX: WBC) and other interested parties in October.

It is in ongoing preliminary discussions and no official announcement has been made.