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Matomy Considers Sale of Debt-Causing Subsidiary Back to Original Owner

Matomy Considers Sale of Debt-Causing Subsidiary Back to Original Owner

Failing to meet the deadline for acquiring the remaining 10% stake in its subsidiary Team Internet, Matomy is now required to sell the company back to its previous owner at a 40% discount

Lilach Baumer | 14:59  07.04.2019

Israel-based digital marketing company Matomy Media Group Ltd. has received an acquisition offer for its subsidiary Team Internet AG from its previous owner Rainmaker Investments GmbH, Matomy announced in a filing to the Tel Aviv Stock Exchange and London Stock Exchange Sunday.

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Matomy has been increasing its stake in Munich-based web advertising company Team Internet since 2012. In February 2018, the company raised $30 million on the Tel Aviv exchange to increase its stake in Team Internet from 80% to 90%. Under the agreement between Matomy and Rainmaker, the former was to acquire the remaining 10% stake in Team Internet by November 30 for $18 million. Failure to meet the deadline meant Rainmaker would be given the option of buying back as much of the stock as they want at a 40% discount.

Tel Aviv Stock Exchange. Photo: Bloomberg Tel Aviv Stock Exchange. Photo: Bloomberg Tel Aviv Stock Exchange. Photo: Bloomberg

Matomy attempted to renegotiate the financial terms of its outstanding bonds before its deadline to gather the needed capital, leading to action against it from bondholders.

On Sunday, Matomy announced Rainmaker had made an offer to acquire all of Matomy's Team Internet stake for $36 million in cash. The money would go towards paying Matomy's bondholders.

Matomy stated its board of directors has decided to proceed with the due diligence process for the offer, and with negotiating a definitive agreement for the acquisition offer within the next 30 days.

In November 2018, Matomy sold its subsidiary mobile advertising platform operator Mobfox Media Advertising GmbH to Tightline Holdings Ltd. for $7.5 million, to raise the funds for furthering its stake in Team Internet. Matomy acquired MobFox in 2014 for $17.6 million, according to Pitchbook data.
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