Digital ads optimization company TLVmedia Ltd. is slashing a third of its workforce, a week after postponing its IPO on the Tel Aviv Stock Exchange (TASE). Sources inform ''Globes'' that, on Monday, 14 of the company's 40 employees will be summoned to layoff hearings as the company tightens its belt because of the indefinite delay in its IPO.
TLVmedia confirmed the details, saying, "The company has chosen to focus on its profitable divisions and reduce activity in non-core businesses. The company has fired 14 employees, most of whom were hired in parallel with the IPO process, which has been postponed."
TLVmedia had planned to raise $30-40 million in an offering of a quarter of its shares on the TASE at a company value of $120 million, after money. The plan was disrupted by the ebbing of the hype around Internet and digital advertising companies listed on foreign markets.
Matomy Media Group Inc. also indefinitely postponed its IPO on the London Stock Exchange; it had planned to raise $100 million at a company value of $500 million, after money.
TLVmedia CEO Ohad Gliksman and president Ofer Zinger founded the company in 2008. Both men are veterans of IDF Unit 8200 and have extensive high-tech experience. The company buys and sells online real-time advertising space using technology that boosts profits for advertisers and site owners. The technology is based on scores of algorithms that analyze thousands of ad campaigns in real time and improves their results by forecasting sales. The company says that it has not raised capital from external sources, and has been profitable for the beginning.
The company's investor presentation stated that revenue fell 22% in 2013 to $19 million, despite an increase in the number of users from 2.8 million in 2012 to 5.5 million in 2013. Earnings before interest, taxes, depreciation and amortization (EBITDA) was halved to $2.8 million in 2013. It had $3 million in cash and $2.2 million in debts to suppliers at the end of 2013, as well as a $3.5 million debt for an owners' loan; they apparently sought to be repaid from the proceeds of the IPO.
Published by Globes [online], Israel business news - www.globes-online.com - on May 18, 2014
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