T-Mobile US will acquire the digital-signage advertising marketplace Vistar Media for $600 million in cash, marking a significant step forward in the realm of measurable marketing solutions. This transaction encompasses Vistar's robust marketplace and technology solutions designed for the buying, selling, and management of media campaigns, indicating a forward-thinking approach from T-Mobile to enhance its advertising offerings.
Vistar boasts an impressive portfolio comprising a global network of over 1.1 million out-of-home (OOH) digital screens, managed by nearly 370 media owners, positioning T-Mobile to leverage these assets effectively. By integrating its consumer insights with Vistar's ad-tech platform, T-Mobile aims to create engaging content that resonates with consumers while providing advertisers with more measurable marketing solutions.
Following the announcement of this acquisition, T-Mobile's shares experienced a 1% increase, reflecting investor confidence in this strategic move. JP Colaco, T-Mobile's Chief T-Ads Officer, expressed optimism regarding the acquisition, stating, "T-Mobile is always envisioning new ways to deliver for consumers, and we see a tremendous opportunity to provide more relevant and personalized advertising." The completion of the transaction is anticipated in the first quarter of this year, pending regulatory approvals.
Analysts expect the deal to be slightly accretive to T-Mobile's earnings before interest, taxes, depreciation, and amortization (EBITDA) once finalized. This acquisition aligns with T-Mobile's long-term growth strategy, reinforcing the guidance provided in September regarding service revenue growth projections.
The firm had indicated an expected compound annual growth rate (CAGR) of approximately 5% from 2023 to 2027 for service revenue, alongside an anticipated increase in core adjusted EBITDA growth at a 7% CAGR by 2027. The timing of the deal has been highlighted as "perfect" by T-Mobile, referencing eMarketer data that forecasts digital OOH advertising spending to account for over one-third of the nearly $10 billion projected total OOH ad expenditure in the United States for this year.
T-Mobile emphasized that digital screens currently represent a small portion of the overall OOH advertising landscape, while accessibility continues to improve. Vistar's platform has reshaped OOH advertising into a "strategic and measurable channel," according to CEO Michael Provenzano. He reinforced this sentiment by stating, "T-Mobile's belief in the future of OOH – and their decision to acquire Vistar – underscores the strength of this channel." Price: 213.36, Change: +2.06, Percent Change: +0.97.