Posted by Tom Foremski - July 31, 2014
Sol Tzvi is CEO and co-founder of Genieo
Genieo, an Israeli startup developing AI software for consumers, has been acquired by Somoto, a publicly traded software company specializing in toolbars for monetizing users' web browsing.
The deal is worth $34.12 million — $20m in cash and the rest in shares. Aviv Levy, reporting on Globes,
Genieo's founders, CEO Sol Tzvi and chairman Jacob Tenenboem, who own 53% of the company's capital in equal shares, will receive most of the acquisition proceeds. A long list of shareholders own the rest, including foreign company Teltora, Comsec Assets, ProSeed Venture Capital Fund (TASE:PRSD), Matrix CEO Moti Gutman, Zvika Barinboim, and Adv. Roni Berkman.
Somoto has already been using some of Genieo's software and the deal is expected to help it acheive a doubling of sales in the coming year.
Founded in 2008, Genieo's operating profit totaled $1.4 million last year on $5.2 million in revenue from advertising, distribution, and searching. Somoto says that Genieo made a $1.6 million operating profit on $3.5 million in the first quarter of 2014.
The proceeds received by the sellers will be paid in two stages: $12.1 million in cash and $6 million in Somoto shares when the deal is completed (scheduled for August 31 this year), and $16 million nine months after the completion date, composed in equal amounts of cash and Somoto shares.
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