Israel’s SintecMedia Buys Operative Media for $200 Million

The merger will combine SintecMedia’s focus on TV ad management with Operative’s strength in digital.

SintecMedia's headquarters in Jerusalem. Emil Salman

Jerusalem-based SintecMedia, whose software helps media companies manage their advertising operations, said late Tuesday it was spending some $200 million to buy the U.S. company Operative Media.

The two sides said the combined company would bring together SintecMedia’s strength in TV ad management, where its customers include NBCUniversal and ABC, with Operative’s focus on digital advertising. Operative’s customers include BuzzFeed and Vice Media. Together SintecMedia and Operative will employ 1,400 people in 14 offices around the world.

“Operative’s fantastic customer base and digital advertising solutions are the perfect complement to our own global client roster and television advertising products,” said SintecMedia CEO Amotz Yarden.

The companies cited figures from eMarketer showing that digital advertising spending in the United States will breach $72 billion in 2016, the first time it matches television. The global market is following a similar growth pattern, they said, while television is rapidly embracing digital and data-driven elements like smart TVs.

The merged company would be able to provide customers in TV and digital a full suite of ad-management tools and eventually help them as advertisers run ad campaigns across different devices. Operative CEO Lorne Brown told The Wall Street Journal that the long-term plan is to create a digital marketplace where sophisticated ad buys can be planned and made.

SintecMedia was formed in 2000 by Yarden and three others and, according to the IVC Research Center, raised $24.5 million in capital before it was sold to Riverwood Capital in 2012. In April, SintecMedia’s management and the U.S. private equity firm Francisco Partners bought the company from its existing shareholders for a reported $400 million.

Before the merger, it counted 850 staff in 11 countries, including 350 at its Bnai Brak research and development center.

The Operative merger follows a string of acquisitions by Sintec, including the 2013 purchases of StorerTV and Argo Systems of the United States. Last year it acquired Broadway Systems.

Operative’s management team, including Brown the company’s founder, are also investors in the combined business. Brown will take the role of president and remain part of SintecMedia’s strategic leadership team.