Ad-tech platform Cadent agreed to be acquired by private-equity firm Novacap. Cadent had been owned by Lee Equity Partners.
Financial terms were not disclosed. Novacap principal Samuel Nasso will become chairman of Cadent, while Cadent’s management team, led by CEO Nick Troiano, remains in place.
Troiano told Broadcasting+Cable that Novacap had been looking to make an acquisition in ad tech and approached Cadent.
“It was opportunistic because it’s a tough M&A market,” Troiano said. “No IPOs. Macro conditions are challenging. So they came to us, and it was a great mix.”
With the ad market in a big of a slump, there have been relatively few ad tech deals recently. One exception is Madhive, which drew a $300 million investment from Goldman Sachs in June.
Novacap will be able to provide Cadent with financing to allow it to pursue a strategy of growth by acquisition.
“They’ve got substantial capital behind us for acquisitions. It’s a great time to be an acquirer,” Troiano said.
“We are at the beginning of a fundamental shift in TV advertising, and with strategic investments and acquisitions we believe Cadent will continue to propel forward as an innovator in the converged marketplace,” Nasso said.
Cadent has transformed itself from a company that served the linear TV ad market to a converged television platform, partly through acquisitions that gave it an identity graph, a demand-side platform and a supply-side platform.
“We’ve moved pretty substantially into the CTV world. We’re growing on average 15% to 20% year over year,“ Troiano said. “We expect to continue to do so in 2023 and I think if the market does rebound, we expect to be in a great position to continue to grow and take advantage of that.”
Cadent’s tech stack is fairly complete at this point, so Troiano said acquisitions could come in three areas.
One is the aggregation of additional audience reach. A second is automation, which could make the company more efficient. The third area is attribution, or showing advertisers their ad dollars are working.
Cadent’s roster of customers includes global agency holding companies and media-buying agencies, more than 70 of the top 100 advertisers and scaled global publishers and content distributors.
“Our success is based on people. We have a fantastic management team and we're all staying on board,” Troiano said. “We’ve been doing pretty well. I think people are galvanized about the opportunity to grow.”
Novacap, based in Montreal, has more than $6 million (Canadian) invested. It previously bought four companies in the telecom, media and technology space, including Static Media.
"Cadent, as a pioneer in converged TV advertising, embodies the kind of innovative, growth-focused company we aim to partner with,” said Pascal Tremblay, managing partner in TMT and CEO at Novacap. “Our extensive capabilities in accelerating high-growth technology companies make us an ideal partner to support Cadent.”
Evercore served as lead financial adviser with Stifel as co-adviser. Weil, Gotshal & Manges LLP served as the legal adviser to Cadent and Lee Equity Partners.
RBC Capital Markets, TD Securities and Scotiabank acted as financial advisers and provided financing to Novacap and Baker Botts LLP acted as legal adviser to the firm.
