MTMY.L Regulatory News (MTMY)

This announcement is an advertisement and not a prospectus and not an offer of securities for sale in any jurisdiction, including in or into the United States, Australia, Canada, Israel or Japan. Neither this announcement nor anything contained herein shall form the basis of, or be relied upon in connection with, any offer or commitment whatsoever in any jurisdiction. Any offer to acquire any securities pursuant to the proposed Offer will be made, and any investor should make his investment decision solely on the basis of the information that is contained in the prospectus (the "Prospectus") to be published by Matomy Media Group Ltd. ("Matomy" or the "Company") in due course in connection with the admission of its ordinary shares ("Ordinary Shares") to trading on the High Growth Segment of the London Stock Exchange plc's (the "London Stock Exchange") main market ("Admission"). Copies of the Prospectus will, following publication, be available from http://www.matomy.com, subject to applicable securities laws, and Matomy's registered office.

8 July 2014

Matomy Media Group Ltd.

Announcement of Offer Price

Matomy Media Group Ltd., one of the world's leading digital performance-based marketing companies, announces confirmation of the pricing of the initial public offering of its Ordinary Shares to certain institutional investors (the "IPO" or the "Offer"). Matomy has applied for admission of the Ordinary Shares to trading on the High Growth Segment of the London Stock Exchange's main market.

OFFER HIGHLIGHTS

· The Offer price has been set at 227 pence per Ordinary Share (the "Offer Price").

· Based on the Offer Price, the total market capitalisation of the Company at the commencement of conditional dealings will be £203 million (approximately $347 million).

· The Offer comprises 18,058,000 Ordinary Shares representing 20.2% of the enlarged issued share capital of the Company following completion of the Offer.

· The Offer is expected to raise gross proceeds of approximately £41.0 million (approximately $70.1 million) for the Company.

· Conditional dealings in the Ordinary Shares will commence on the London Stock Exchange at 8.00 a.m. today under the ticker MTMY (ISIN: IL0011316978, SEDOL: BKRVS34).

· Admission and the commencement of unconditional dealings are expected to take place at 8.00 a.m. on 11 July 2014.

· At Admission, the Company will have 89,276,028 Ordinary Shares in issue.

· In relation to the Offer, Canaccord Genuity Limited ("Canaccord Genuity") is acting as Key Adviser and Sole Bookrunner and Leumi Partners Underwriting Ltd. ("Leumi") is acting as Co-manager.

OVERVIEW OF MATOMY MEDIA GROUP LTD.

Matomy is one of the world's leading digital performance-based marketing companies. Its customers are primarily advertisers, advertising agencies and other businesses around the world that promote or sell products and/or services to consumers through digital media, such as websites, mobile apps and social media networks. Matomy manages and optimises its customers' digital marketing campaigns using its proprietary technology platform (the "Matomy Performance Platform") to maximise their reach to their target audience.

Matomy's performance-based business model enables its customers to acquire new consumers on a risk-free basis based on specific characteristics, such as gender, age and location. Matomy typically charges a customer only if the digital marketing campaign achieves certain measurable results, which the customer pre-defines and validates. Such results include conversions into service or product sales, consumer acquisitions, software and mobile app installations, qualified leads for value-added services and products and verified video views.

Matomy currently operates across eight media channels: display, mobile, social media, video, email, search, virtual currency and domain monetisation. Matomy believes its coverage of multiple media channels enables it to serve the strong demand for simplicity and efficiency in the fragmented digital advertising market. Consumers are spending increasing amounts of time on multiple digital devices, which creates challenges for Matomy's customers to reach potential consumers. Matomy provides its customers simple, efficient and centralised solutions to capitalise on these changing consumer behaviour patterns.

Matomy manages and optimises its customers' digital marketing campaigns through its relationships with over 16,000 registered digital media sources. These digital media sources generally fall into one of three categories:

· those with whom Matomy cooperates directly, such as Facebook, Google, Planet.fr and other websites;

· those with whom Matomy interacts through media marketplaces, such as advertising exchanges and supply-side platforms, including AppNexus, Yahoo Ad Exchange and Vidible; and

· those with whom Matomy interacts through its network of third parties, called affiliates, that are able to run customers' digital marketing campaigns through their own digital media sources, such as YesUp and SponsorPay.

With this large and diversified network of digital media source relationships, Matomy is not dependent on any one digital media source and can thereby give its customers broad reach, liquidity and choice. These digital media sources collaborate with Matomy because Matomy helps them monetise their digital media and shares its revenues with them.

Matomy manages and optimises its customers' digital marketing campaigns on the Matomy Performance Platform. This technology combines proprietary, open- source and customised third-party software solutions with Matomy's extensive industry and operational know-how, refined over seven years of operational experience and R&D. The Matomy Performance Platform continuously records and analyses consumer responses to digital marketing campaigns, allowing Matomy to refine the campaigns and optimise their performance. Since the Matomy Performance Platform is integrated with or linked to the systems of its digital media sources, Matomy can manage digital media demand with greater automation and efficiency.

For the three months ended 31 March 2014, Matomy had 1,676 active customers worldwide across a wide range of industry verticals, including games and entertainment, healthcare, finance and education. Matomy typically charges a customer only if Matomy delivers certain pre-defined, measurable and validated results on a per-action basis, such as cost-per acquisition ("CPA"), cost-per-download ("CPD"), cost-per-install ("CPI"), cost-per-lead ("CPL"), cost-per-sale ("CPS"), cost-per- verified video view ("CPV") and pay-per-call ("PPC"). Matomy generally does not charge on a cost-per-click ("CPC") or cost-per-impression ("CPM") basis. Matomy also generally does not charge any non-performance-based fees, such as set-up, account maintenance, creative services or other similar fees. Matomy believes that its performance-based pricing model closely aligns its interests with those of its customers, who are increasingly looking for measurable returns on their marketing expenditure.

Matomy is based in Israel and has offices in the United States, Europe and Latin America. Matomy launched operations in 2007 and has generated positive adjusted EBITDA every year since 2008.

In preparation for the IPO, Matomy has appointed four experienced independent non-executive directors to complement the existing Board under the continued Chairmanship of Ilan Shiloah.

Commenting on the announcement, Ofer Druker, Chief Executive Officer, said:

"Today marks another step forward in realising our ambition to become one of the world's leading digital performance-based marketing companies. We were disappointed to have postponed our Offer earlier in the year, but we are delighted to be announcing our Offer price today with such strong investor support. We have continued to grow our business in the interim, including the recent successful acquisition of a majority ownership stake in the direct navigation Internet search company Team Internet.

"We are coming to market with a compelling proposition for investors, namely: our propriety technology, global presence and extensive experience, as well as our consistent record of strong growth in both revenue and EBITDA. I am confident that Matomy, as a public company, will be able to capitalise on its achievements to date and continue to deliver for all its stakeholders."

Ilan Shiloah, Chairman, said:

"Matomy is an innovative, successful company which has gone from strength to strength in recent years The funds raised through the IPO will give us a strong platform to deliver further growth and we believe there are significant opportunities ahead of us, a sentiment shared by the high quality institutions who have supported the Offer."

"Additionally, I am delighted to welcome our new Non-executive Directors, including Rupert Howell as Deputy Chairman and Senior Independent Director, and Gary Hughes as the chairman of the audit committee, to Matomy. I look forward to working with them and the other Board members and management team as we strive to achieve our vision of becoming one of the world's leading performance-based marketing companies."

ENQUIRIES

Matomy Media Group Ltd.

+972 77 360 6060

Ilan Shiloah, Chairman

Ofer Druker, Chief Executive Officer

Sagi Niri, Chief Financial Officer

Key Adviser and Sole Bookrunner

Canaccord Genuity

+44 20 7523 8000

Simon Bridges, Managing Director, Head of Corporate Broking

Tim Redfern, Managing Director, Equity Capital Markets

Peter Stewart, Director, Corporate Broking

Mark Whitmore, Associate, Corporate Broking

Co-manager

Leumi

+972 35 141 290

Ram Dagan, Managing Director

MEDIA ENQUIRIES

Tulchan Communications

+44 20 7353 4200

Lucy Legh

Stephen Malthouse

Matomy Media Group Ltd.

+1 417 299 5996

Keith Trivitt

NOTES TO EDITORS

Except where the context otherwise requires, defined terms used in this announcement have the meanings given to such terms in the Prospectus to be published by the Company later today.

OFFER STATISTICS

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Each of the times and dates in the above timetable is subject to change. References to times are to London time unless otherwise stated.

(1) Assuming the pre-IPO reorganisation described in paragraph 4 of Part 11 (Additional Information) of the Prospectus has taken place.

(2) Matomy's market capitalisation at any given time will depend on the market price of the Ordinary Shares at that time. Matomy cannot assure prospective investors that the market price of an Ordinary Share will be equal to or exceed the Offer Price.

(3) After deduction of approximately £4.6 million (exclusive of VAT) of underwriting commissions, legal, financial public advisory and other expenses payable by Matomy in connection with Admission and the Offer.

MATOMY MEDIA GROUP LTD. HIGHLIGHTS

Matomy believes that the following key strengths are the foundation of its success:

Matomy operates in a fast-growing market

· The global digital advertising market was $88.8 billion in 2012, and will grow to $156.2 billion by 2016, according to ZenithOptimedia.

· ZenithOptimedia also estimates that mobile, social media and video are among the fastest growing media channels, with expected annual growth rates of 54%, 30% and 23%, respectively, from 2012 to 2016.

· Matomy operates in the fastest-growing segment of digital advertising, performance-based advertising, which comprises 65% of total US online advertising spend as of 2013, according to the Interactive Advertising Bureau.

Matomy provides its customers with the ability to generate risk-free performance-based results

· Matomy believes that its performance-based pricing model closely aligns its interests with those of its customers, who are increasingly looking for measurable returns on their marketing expenditure.

· Matomy believes its customers perceive its performance-based business model as attractive since they are only charged if their digital marketing campaigns achieve certain pre-defined, measurable and validated results, such as CPA, CPD, CPI, CPL, CPS, CPV and PPC.

Matomy operates a centralised and integrated multi-channel digital media approach that enables it to reach a broader range of consumers over more of the day on a wide variety of digital devices

· Matomy is one of the few digital performance-based marketing companies that are able to deliver digital marketing campaigns across eight media channels on a wide variety of digital devices.

· By offering its customers access to these eight media channels, Matomy reduces the need for them to retain multiple digital performance-based marketing companies.

· Matomy's customer relations team serves as a single point of contact for its customers and enables them to expand the size and scope of their digital marketing activities to additional media channels.

Matomy has a diverse, profitable and loyal customer base

· For the three months ended 31 March 2014, Matomy's customer base included 1,676 active customers spanning more than eight industry verticals, and included leading global brands such as American Express, Experian and Bwin. For the three months ended 31 March 2014 and the year ended 31 December 2013, no single customer represented more than 7% or 6%, respectively, of Matomy's total revenues.

· In line with its "win-win" partnership approach, Matomy only engages customers that it expects will generate sufficient profitability for it from the outset, and only retains them if Matomy is able to maintain that level of profitability or, in limited cases, if Matomy believes they have significant potential to increase their profitability with Matomy.

· For the year ended 31 December 2013, 68% of Matomy's revenues were attributable to customers with whom it had been working with for more than two years.

· For the three-year and three month period ended 31 March 2014, Matomy's average revenue retention rate (total revenues generated during each year, less revenues generated from customers with whom Matomy had less than a 12-month relationship, divided by total revenues generated during the previous year, excluding revenues contributed by businesses acquired in 2013) was 112%.

Matomy maintains strong relationships with a large and diversified network of digital media sources

· Matomy's network of more than 16,000 registered digital media sources enables it to generate more than 60 billion unique impressions per month to reach audiences in over 100 countries.

· Matomy is not dependent on any one digital media source, and can thereby give its customers broad reach, liquidity and choice of multiple digital media channels through which they can engage, acquire new and retain existing customers.

· No single digital media source accounted for more than 6% and 4%, respectively, of Matomy's total media costs for the three months ended 31 March 2014 and the year ended 31 December 2013.

Matomy operates a scalable and adaptable technology platform

· Matomy has built the Matomy Performance Platform into a scalable, adaptable, robust and automated proprietary technology that records and analyses its customers' digital marketing campaigns in real time.

· The Matomy Performance Platform allows Matomy to support new media channels and industry verticals at relatively low marginal cost, enabling it to adapt rapidly to the constantly evolving digital advertising market.

· The Matomy Performance Platform records and aggregates hundreds of millions of user events every day. Matomy uses such data, along with its extensive industry and operational expertise, to perform advanced targeting, predictive analysis and campaign retargeting to maximise performance for Matomy's customers' digital marketing campaigns.

· Matomy believes its data analysis capabilities help it generate higher returns for its customers on their marketing expenditure.

Matomy has a profitable and cash-generative financial model

· Matomy's strong historical financial performance is the result of its strategy to expand its business whilst maintaining a sustainable and profitable financial model.

· For the years ended 31 December 2013, 2012 and 2011, Matomy generated revenues of $193.5 million, $120.1 million and $106.7 million, respectively, representing a CAGR of 34.7% for the period. For the three months ended 31 March 2014 and 2013, Matomy generated revenues of $57.6 million and $49.6 million respectively, representing a CAGR of 16.1%.

· Matomy believes that one of its key differentiating factors is its ability to manage its growth through its rigorous customer acquisition and campaign management processes, controlling business risk and yielding growing profits.

· Matomy has generated positive and growing adjusted EBITDA since 2008. For the years ended 31 December 2013, 2012 and 2011, Matomy generated adjusted EBITDA of $13.1 million, $9.1 million and $9.3 million, respectively, representing a CAGR of 18.8%. For the three months ended 31 March 2014 and 2013, Matomy generated adjusted EBITDA of $4.6 million and $3.2 million respectively, representing a CAGR of 43.8%.

Matomy has a highly experienced and cohesive management team

· The majority of Matomy's current senior management team has worked together since 2008. Matomy's senior management team draws upon its significant experience and expertise in the digital advertising market, including at companies such as McCann-Erickson, MSN, Groupon Israel and Oridian (now Ybrant Digital).

· Matomy's senior management team has a track record of successfully identifying, acquiring and integrating complementary businesses into Matomy. Matomy believes the team's skills and knowledge will contribute to Matomy's inorganic growth as and when new strategic opportunities arise.

IMPORTANT NOTICE

The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness.

This announcement is not for publication or distribution, directly or indirectly, in or into the United States. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This announcement does not contain or constitute an offer of, or the solicitation of an offer to buy, Ordinary Shares to any person in the United States, Australia, Canada, Japan, Israel or in any jurisdiction to whom or in which such offer or solicitation is unlawful.

The Ordinary Shares have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act"), or with any securities regulatory authority or under the laws of any state or jurisdiction of the United States. Accordingly, the Ordinary Shares may not be offered, sold, resold, delivered, distributed or otherwise transferred, directly or indirectly, in, into or from the United States except pursuant to a registration statement that has been declared effective under the Securities Act or in transactions exempt from, or not subject to, the registration requirements of the Securities Act.

The offer and sale of Ordinary Shares referred to herein has not been and will not be under the applicable securities laws of Australia, Canada, Israel or Japan. Subject to certain exceptions, the Ordinary Shares referred to herein may not be offered or sold in Australia, Canada, Japan, Israel or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, Israel or Japan. There will be no public offer of the Ordinary Shares in the United States, Australia, Canada, Israel or Japan or elsewhere.

This announcement is only addressed to, and directed at, persons in member states of the European Economic Area other than the United Kingdom who are "qualified investors" within the meaning of Article 2(1)(e) of the Prospectus Directive ("Qualified Investors"). For the purposes of this provision, the expression "Prospectus Directive" means Directive 2003/71/EC, as amended, and includes any relevant implementing measure in each member state of the European Economic Area which has implemented the Prospectus Directive. In addition, in the United Kingdom, this announcement is being distributed only to, and is directed only at, qualified investors (i) who have professional experience in matters relating to investments who fall within the definition of "investment professional" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"), or (ii) who are high net worth companies, unincorporated associations and partnerships and trustees of high value trusts as described in Article 49(2) of the Order, and (ii) other persons to whom it may otherwise lawfully be communicated (all such persons together being referred to as "relevant persons"). Any investment or investment activity to which this announcement relates is available only to and will only be engaged in with such persons. This announcement must not be acted on or relied on (i) in the United Kingdom, by persons who are not relevant persons, and (ii) in any member state of the European Economic Area other than the United Kingdom, by persons who are not qualified investors.

This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements reflect the Company's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Group's business, results of operations, financial position, liquidity, prospects, growth or strategies. Forward-looking statements speak only as of the date they are made.

Each of the Company, Canaccord Genuity, Leumi and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward looking statement contained in this announcement whether as a result of new information, future developments or otherwise.

Any subscription or purchase of Ordinary Shares in the proposed Offer should be made solely on the basis of the information contained in the final Prospectus to be issued by the Company in connection with the Offer. No reliance may or should be placed by any person for any purposes whatsoever on the information contained in this announcement or on its completeness, accuracy or fairness. The information in this announcement is subject to change.

The date of Admission may be influenced by things such as market conditions. There is no guarantee that Admission will occur and you should not base your financial decisions on the Company's intentions in relation to Admission at this stage. Acquiring investments to which this announcement relates may expose an investor to a significant risk of losing all of the amount invested. Persons considering making such investments should consult an authorised person specialising in advising on such investments. This announcement does not constitute a recommendation concerning the Offer. The value of the Ordinary Shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of the Offer for the person concerned.

Canaccord Genuity, which is authorised and regulated by the Financial Conduct Authority, and Leumi are acting exclusively for the Company and no-one else in connection with the Offer. They will not regard any other person as their respective clients in relation to the Offer and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, nor for providing advice in relation to the Offer, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the Offer each of Canaccord Genuity and Leumi and any of their respective affiliates, acting as investors for their own accounts, may subscribe for or purchase Ordinary Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Ordinary Shares and other securities of the Company or related investments in connection with the Offer or otherwise. Accordingly, references in the Prospectus, once published, to the Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by Canaccord Genuity and Leumi and any of their respective affiliates acting as investors for their own accounts. Canaccord Genuity and Leumi do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Neither of Canaccord Genuity nor Leumi nor any of their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.

Certain figures contained in this document, including financial information, have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change of the numbers contained in this document may not conform exactly with the total figure given.