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Yinon Landenberg and Doron Tal are negotiating to sell half of interactive advertising firm E-dologic. The two own 49% of the company's shares, and are conducting talks with a financial investor active in Israel.

Sources close to the negotiations say the firm is being valued at $36 million, which represents 15 times average profits over the past three years.

TheMarker has obtained E-dologic's financial reports - the company generated revenues of $20 million in 2007. E-dologic is Israel's No. 2 interactive agency after McCann Digital, according to figures from Ifat Media Information.

But the numbers in the financial statements are much higher than those reported to Ifat. While the 2007 numbers have yet to be published, Ifat's figures for the year show less than half the other sum.

Landenberg said he regretted that the financial reports had found their way to the press and refused to say more. Tal confirmed that negotiations were underway, but declined to give details.

E-dologic was founded in 1999 and was Israel's first interactive advertising agency. In 2001 international advertising giant Publicis bought 51% of the shares. Landenberg and Tal, who were 26 when they founded E-dologic, remained co-CEOs, and each retained 24.5% of the firm.

Three years ago Tal left E-dologic and went to work at Bauman Bar Rivnai to establish a new interactive agency. His shares in E-dologic were left in trust.

Sources involved in the negotiations added that Publicis has tried a number of times to increase its holdings in E-dologic, but Landenberg and Tal refused to sell their shares due to a disagreement over the value.

Now it seems that they intend to sell their shares to someone outside the advertising world."

E-dologic was founded as an Internet site intended to supply information to demobilized soldiers. It started in the online advertising market by mistake when it attempted to find out how to go about advertising its site.

Landenberg and Tal then recognized the vacuum that existed in online advertising at the time.

They offered their ideas to all the big agencies, but none were interested, and only in 2000 did Publicis take a chance on the young firm.