Why Do Audioboom and Triton Digital Want to Merge?

Aliya Ram and Katie Martin writing in the Financial Times (sorry for the paywall):

AudioBoom, the UK podcasting company…, will be merged with larger US rival Triton Digital in a £134m deal that will allow them to expand in the fast-growing market for radio advertising.

What does Triton Digital and Audioboom do exactly?

Triton Digital does a whole bunch of things under a ‘tech services for radio’ umbrella but its main focus is on automating ad placement. TAP (Triton Advertising Platform) offers dynamic ad insertion for broadcast radio and radio streaming services and provides tools for broadcasters to automate converting their live broadcast content into on-demand content. It launched an ad platform for podcasts in January 2016 and signed NPR to use it.

Audioboom offers similar tech services but entirely for podcasting: hosting, analytics and its own ad platform. They too were focused on the enterprise customer but in June 2017 they opened up their $9.99 tier for creators with fewer than 10,000 listens per month. Audioboom is active in a couple of areas that Triton Digital isn’t - Audioboom has a content business, recently signing with Casefile as exclusive distributor and they have announced three new original shows. They also have an ad sales business and have just hired a veteran sales executive (there was some questions about whether the ad sales side of the business would continue after the merger this new hire signals it will).

What Do They Get out of This Merger?

My guess is that the main appeal for Trition Digital is that this is a way to go public (and so provide value back to their investors) without the cost and effort of a traditional IPO. The deal sees that the Board of Triton Digital remains unchanged. AudioBoom’s share price hit a high of 16.625GBP in September 2014 but at the time of writing shares were worth 3.60GBP. Audioboom is a public company listed on London’s Alternative Investment Market (which allows smaller companies to float shares with a more flexible regulatory system than London’s main market). The merged group will trade as Triton Digital Group PLC, a UK publicly traded company.

With broadcast radio, Triton Digital finds itself with a strong presence in a declining industry as listeners move to streaming and on demand services. Podcasting is super buzzy right now (indeed, any fool thinks he can start a blog about the podcast industry) so this merger strengthens Triton’s presence in the growing podcast industry.

For Audioboom this would open up the North American market to them (they are strong in the UK but with a much smaller presence in the US) and so access to US radio market for their original content. Yes, radio is in decline but just yesterday the New York Times announced it was going to start making a radio edition of The Daily so there is life in radio yet.

Further reading: Audioboom’s notice to UK regulators about the merger