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Millennial Media To Acquire Mobile Ad Company Jumptap For $200M+ In Millennial Stock

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Millennial Media just announced that it has reached an agreement to acquire Jumptap, a deal that brings together two well-known mobile ad companies.

The acquisition press release describes the deal as “a predominantly stock transaction,” with Jumptap shareholders to receive 24.6 million shares in publicly traded Millennial, giving them ownership of about 22.5 percent of the company. (At the current price, those shares would be worth about $209 million.)

“Millennial Media already runs one of the largest third-party digital media businesses, despite mobile being in its early stages,” said Millennial President and CEO Paul Palmieri in the release. “Jumptap’s expertise in performance, cross-screen, real-time bidding and third-party data fit well with, and provide incremental scale to Millennial Media’s existing platform.”

Founded in 2004, Jumptap had raised $122 million in funding from investors including General Catalyst Partners, Summerhill Venture Partners, Redpoint Ventures, Valhalla Partners, and AllianceBernstein, as well as ad giant WPP. As of last year, it was preparing for an IPO, but it seems like those plans were called off. (We’d recently heard a rumor, which we were unable to confirm, that Jumptap was going to be purchased by AppNexus — either way, it seems likely that Jumptap was talking to multiple potential buyers.)

millennial jumptap slide

According to a slide deck just published by Millennial, Millennial saw $177.7 million in adjusted revenue in 2012, while Jumptap saw $63.6 million ($53 million if you exclude portal revenue). Their respective net losses for 2012 were $5.4 million and $13.0 million. (Adjusting for taxes and other expenses, Millennial had EBITDA of $4.5 million and Jumptap had an EBITDA loss of $10.7 million.) The presentation projects that the combined companies will have revenue between $340 million and $350 million, with adjusted EBITDA somewhere between $1 million and a loss of $1 million.

Jumptap CEO George Bell is joining the Millennial board of directors as vice chairman.

Millennial also released its second-quarter earnings results, with revenue of $57 million and a net loss of $3.1 million.

Update: On the earnings conference call, Palmieri emphasized that the two companies are complementary, particularly given Millennial’s focus on brand advertising and Jumptap’s focus on performance advertising and real-time bidding. He also cited Millennial’s focus on first-party data and Jumptap’s focus on third-party data. Palmieri described the combined entity as “rivaling Google in mobile display” — a point that was also made in the slide below.

Millennial also says that the combined stock and cash components of the transaction value Jumptap at $232 million.

millennial market slide