Synopsis:
Vertoz jumped sharply after it announced the acquisition of Webimax, a US-based AI marketing firm, valuing it at Rs $6.6 million (Rs 58.42 crore). The agreement is a significant one as it increases the top line, bottom line, and return on equity, and is also expected to benefit from strong synergies.
The shares of this leading online advertising services company are in focus after making a key acquisition in the business, paving its way towards much hyped theme, which is AI. In this article, we will dive more into the details.
With a market capitalisation of Rs 627 crore, the shares of Vertoz Ltd reached a day’s high of Rs 75.50 per share, up 5.5 percent from its previous day’s closing price of Rs 71.56 per share. Over the past five years, the stock has delivered a multibagger return of 701 percent, outperforming NIFTY 50’s return of 101 percent.
About the Acquisition
Vertoz Limited, through its US-based subsidiary Vertoz Inc., has signed a binding agreement to acquire Webimax LLC, an AI-driven marketing automation company in New Jersey. The company will buy 80 percent of Webimax for $5.28 million (Rs 46.82 crore), which includes $4.88 million (Rs 43.27 crore) in cash and a $0.4 million (Rs 3.5 crore) performance-linked earn-out over three years. The rest 20 percent will be acquired based on the future EBITDA of Webimax after three years.
The total enterprise value is $6.6 million (Rs 58.42 crore), and the transaction will close within 90 days. The money for the transaction will be sourced 75 percent as debt from India’s premier foreign trade financial institution and 25 percent from the internal cash flows of Vertoz, whereby the shareholders will not have any equity dilution.
This deal will immediately enhance Vertoz’s financial performance. After the consolidation, the company will add nearly 9.5 million USD (~Rs 87 crore) in revenue and around 17 crore in annualised profit. The management also expects synergies worth 2–3.5 million USD (Rs 17-29 crore) over the next 18–30 months from better efficiencies, AI-led delivery, and strong cross-selling opportunities.
The funding by a major government-backed financial institution is a testament to the robustness of Vertoz’s balance sheet and its governance. Besides, the transaction will also help increase Return on Equity (RoE) as the company opted for debt and internal cash rather than new equity.
Webimax LLC is a technology and performance solutions company in the US that was founded in 2008 and is located in New Jersey. It had FY24 revenue of 12 million USD (Rs 107 crore), EBITDA of 2.4 million USD (Rs 21 crore), and PAT of 1.8 million USD (Rs 16 crore). The company offers a variety of AI-powered services, such as search intelligence, predictive performance systems, reputation and sentiment analysis, web engineering, automated lead qualification, and data-layer strategy.
The company is led by industry veteran Kenneth Wisnefski, who, before building and selling VendorSeek.com to NASDAQ-listed QuinStreet Webimax and who brings solid technical skills and a trusted international presence. So, this move is not only opening up more Vertoz expansion options worldwide but also enhancing the company’s offerings in the rapidly evolving digital advertising and AI automations sectors.
Q2 Highlights
Vertoz reported a core revenue of Rs 72.26 crore in Q2 FY26, a growth of 14 percent as compared to Rs 63.65 crore in Q2 FY25. Additionally, on a quarter-on-quarter basis, it grew by 3 percent from Rs 70.49 crore.
Regarding its profitability, it reported a net profit of Rs 7.24 crore in Q2 FY26, a growth of 10 percent as compared to Rs 6.57 crore in Q2 FY25. Additionally, on a quarter-on-quarter basis, it recorded a growth of 12 percent from Rs 6.47 crore.
Vertoz is an AI-powered tech company that helps companies to advertise on the internet, reach their target audience, and expand their digital footprint. The company provides a range of solutions such as digital marketing, online ads, media buying, and website monetisation. Besides, it offers cloud services like domain registration and web hosting.
To put it simply, Vertoz is delivering the equipment which a firm requires to make a self-promotion campaign via the internet and handle digital infrastructure. The company is the solution for brands, advertisers, publishers, and tech firms.
Written by Satyajeet Mukherjee
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