Nexxen's $20 Million Share Repurchase Program: A Strategic Move
Nexxen Announces New $20 Million Ordinary Share Repurchase Program
Recently, Nexxen International Ltd. (NASDAQ: NEXN), a prominent global player in the advertising technology sector, declared its intention to seek approval for a $20 million Ordinary Share repurchase program. This program is slated to begin once the current repurchase effort is fully realized, signaling confidence in the company’s robust future and its current valuation status.
Strategic Rationale Behind the Repurchase
The strategic decision to initiate this repurchase program stems from Nexxen’s strong cash flow position bolstered by a profitable business model that consistently generates cash. This financial flexibility will allow Nexxen to implement a balanced approach to capital allocation, prioritizing not only long-term growth initiatives but also shareholder value enhancement.
Investment in VIDAA
In tandem with the new repurchase program, Nexxen has announced a significant investment of $35 million in VIDAA, marking an increase in its equity stake to approximately 6%. This investment is poised to support VIDAA’s expansion into the North American Connected TV (CTV) market, which is crucial for enhancing Nexxen’s exclusive data and advertising monetization rights, thereby creating substantial long-term value.
Focus on Innovation and Growth
Beyond the repurchase initiative, Nexxen is committed to enhancing its commercial and media teams and investing in product innovation. This ongoing effort aims to fuel future growth and solidify the company's position in a highly competitive global market. Continuous improvement in technology and services is essential for achieving sustained success.
Exploring Strategic Opportunities
Nexxen is actively exploring additional targeted strategic opportunities, albeit smaller than prior acquisitions like Amobee. This exploration seeks to expand its monetizable data assets, optimize artificial intelligence capabilities, and drive growth across its core business lines in the U.S., as well as internationally.
Compliance with Regulatory Requirements
Being an Israeli firm, Nexxen must adhere to specific regulations, notably the 30-day creditor objection period before the new repurchase program can officially commence. While no court approval is necessary, the program will require consent from the company’s bank lenders to initiate.
Current Financial Position and Future Plans
Assuming a smooth transition during the creditor objection timeframe, and following the necessary lender approvals, Nexxen is on track to kick off the new repurchase program. This initiative does not mandate purchasing a predetermined number of shares, allowing Nexxen flexibility to adjust the program based on market conditions and regulation compliance.
As of now, the company has approximately $7.2 million left in its existing share repurchase authorization, anticipating its completion ahead of the planned close date.
About Nexxen
Nexxen stands at the forefront of innovation, empowering advertisers, agencies, and broadcasters globally to leverage data and advanced television. The company’s unifying technology stack, incorporating a demand-side platform and a supply-side platform integrated with the Nexxen Data Platform, reflects its commitment to fulfilling the diverse needs of its partners.
With a network spanning the United States, Canada, Europe, and Asia-Pacific, Nexxen is not only strategically positioned but continuously evolves to foster strong partnerships and drive substantial results in the advertising realm.
Contact Information:
Nexxen International Ltd.
Billy Eckert, Vice President of Investor Relations
ir@nexxen.com
Caroline Smith, Vice President of Communications
csmith@nexxen.com
Frequently Asked Questions
What is the purpose of Nexxen's share repurchase program?
The program aims to acquire Ordinary Shares at discounted valuations to enhance shareholder value and show confidence in Nexxen’s long-term prospects.
How much does Nexxen plan to invest in VIDAA?
Nexxen is set to invest an additional $35 million in VIDAA, increasing its stake to approximately 6%.
What are the regulatory requirements Nexxen must meet for the repurchase program?
Nexxen must comply with Israeli regulations, including a 30-day creditor objection period before the program can start.
What will happen to the shares repurchased by Nexxen?
Shares bought back under the repurchase program will be classified as dormant shares and held in treasury without rights.
When is Nexxen expecting to complete its current repurchase authorization?
The current repurchase is expected to be completed before the scheduled end date.
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