Synacor Preps Public Outing

‘TV Everywhere’ Specialist Hopes to Raise Up to $75M

By Todd Spangler -- Multichannel News, 2/6/2012 12:01:00 AM

Synacor, a provider of TV Everywhere services and Web-portal software to cable and telecom operators, expects to raise up to $75 million in an initial public offering — which would be one of the first IPOs in the video-technology space in recent memory.

The company, which originally filed for the IPO in mid-November, last week disclosed expected pricing of $10 to $12 per share for 6.82 million shares (including 1.36 million shares owned by selling stockholders, from which Synacor not receive any proceeds). In addition, underwriters will have the option to purchase up 1 million shares at a discount from the offering price.

Other video and TV-related technology firms that have filed for IPOs in the last year include encoding-equipment vendor Envivio and mobile-video provider MobiTV.

Synacor declined requests for executive interviews, citing quiet-period restrictions. After the IPO, the company expects its shares will trade on the NASDAQ Global Market under the symbol “SYNC.”

Historically, Charter Communications and CenturyLink have been Synacor’s two biggest customers, together accounting for 62% and 60% of its revenue for the years ended 2009 and 2010, according to the IPO filing. The company also has signed Dish Network and Verizon Communications and Toshiba as clients.

Synacor cites its main competition as inhouse information technology staffs at MSOs and telcos that roll their own Web solutions. Other competitors include major portal operators Yahoo, Google, AOL and MSN.

But Google is also a major partner: Synacor includes a Google-branded search tool on the websites of customers, and the Internet search giant accounted for approximately 55% of Synacor’s revenue, or $34 million, for the nine months ended Sept. 30, 2011.

SYNACOR: AT A GLANCE

Description: Provider of content-aggregation and authentication solutions for cable and telecom service providers and consumerelectronics manufacturers.

Customers: Charter, CenturyLink, Dish Network, Verizon, Suddenlink, Mediacom, Toshiba

Users: 18.7 million unique visitors per month in Q4 2011 (comScore)

Financials: Full-year 2011 revenue of $90.6 million to $91.0 million and net income of $3.8 million to $4.2 million

Headquarters: Buffalo, N.Y. Employees: 261

SOURCE: Company reports