An investment fund affiliated with J.P. Morgan is paying $100 million for a 7 percent stake of online and mobile engagement tool maker Conduit, which is now valued at $1.3 billion. The investment fund, which is being advised by J.P. Morgan Asset Management but was not further identified has agreed to buy up the remaining stake of early Conduit investor Yosma Venture Capital, which had previously tried to sell its interest to Silver Lake Partners.
Yosma first acquired a 9 percent stake of Conduit after investing $1.5 million in 2006. After reportedly trying to sell its stake to Silver Lake earlier this year, it sold off 2 percent to W Capital Partners before sealing a deal with J.P. Morgan. Conduit said the new valuation would make it Israel’s first billion Internet company.
Conduit, which allows publishers to create custom toolbars to better engage with users, has a network of 260,000 publishers with a combined audience of 250 million users. The company’s founder, chairman and CEO Ronen Shilo recently told Globes, an Israeli business publication, that Conduit is making hundreds of millions of dollars in revenue annually. It bolstered its online tools a year ago when it paid $45 million for fellow Isreali start-up Wibiya, a maker of social toolbars for publishers. Conduit has also been moving into mobile with a service that helps publishers build apps and is also working on a lock-screen tool for Android devices.
Conduit, which has raised $9.8 million including an $8 million round from Benchmark Capital, was rumored to be an acquisition target for possibly Microsoft or Google at a price of more than $1 billion. But the company has said in the past it is not looking to be acquired or go public.
“As our constantly connected world continues to evolve, the ways that we engage our users must change with it. The next few months will be some of the most important in the history of Conduit, and we’re thrilled to have partners like J.P. Morgan Asset Management as our company continues to grow,” said Shilo in a statement.