19th Mar 2024 16:36
(Alliance News) - Team Internet Group PLC's acquisition of Shinez IO Ltd brings significant revenue potential, according to analysts at Edison.
On Tuesday, the London-based internet services company announced that it had agreed to buy Shinez IO Ltd, a Tel Aviv-based online marketing business, for USD41.8 million. The acquisition is expected to complete in late April or early May.
This news followed robust earnings released on Monday, with the company doubling pretax profit to USD29.3 million in 2023 from USD14.8 million in 2022. This was largely driven by organic growth across the business as revenue rose by 15% to USD836.9 million from USD728.2 million.
As a result of this strong performance it proposed a final dividend of 2.0 pence per share, double that of the year before.
Analysts at Edison Group believe that continued organic growth combined with the acquisition of Shinez may "drive stock upside".
The acquisition, which is to be funded through a combination of cash reserves and a rolling credit facility, will bolster the company's search division. It is expected to drive traffic growth from the 40 sites Team Internet operates, whilst enhancing the company's prominence across key publishers like Google, Amazon, Facebook, X and Yahoo.
According to Edison Group, the consolidated entity would have combined revenue of USD947.9 million. Edison said USD1 billion is an "achievable" revenue target in the medium term.
Shares in Team Internet closed up 0.9% to 136.00 pence in London on Tuesday.
By Elijah Dale, Alliance News reporter
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