TIDMAPPS
RNS Number : 5327S
appScatter Group PLC
26 June 2018
26 June 2018
appScatter Group plc
("appScatter" or the "Company")
Acquisition of Priori Data GmbH and Associated Fundraise
appScatter Group plc (AIM: APPS), the scalable
business-to-business ('B2B') Software as a Service ('SaaS')
platform that allows users to distribute and manage their apps on
multiple app stores around the world, is delighted to announce that
it has agreed revised terms for the acquisition of Priori Data GmbH
("Priori").
Following the lapsing of a previous acquisition agreement
between the parties, as announced on 18 June 2018, and under the
terms of a revised conditional sale and purchase agreement ("the
Acquisition Agreement"), appScatter Group plc will acquire 100 per
cent. of the share capital of Priori for a total consideration
payable on completion of GBP13.5 million (the "Acquisition"), of
which approximately GBP1.8 million will now be payable in cash (the
"Cash Consideration") and GBP11.7 million will be satisfied by the
issue of a total of 16,667,157 new ordinary shares in the Company
(the "Consideration Shares") at an effective issue price of 70
pence per ordinary share ("Ordinary Shares"). 16,290,325 of the
Consideration Shares will be issued on Completion of the
Acquisition and 376,832 of the Consideration Shares (representing
EUR300,000 in issue value) will be deferred until the determination
of the completion accounts and the net assets statement in
connection with the Acquisition which will be due forty five days
after completion (the "Deferred Shares"). Further details of the
Acquisition Agreement are set out below.
Completion of the Acquisition is conditional on, inter alia, the
passing of the resolutions at the Company's upcoming Annual General
Meeting on 29 June 2018 (the "AGM"), following which the
Acquisition is expected to complete using the share issuance
authorities sought at the AGM to enable the issue of the
Consideration Shares and the Fund Raise Shares (as defined
below).
The Company is also pleased to announce that it has completed a
further conditional fundraising (the "Fund Raise") by way of
subscriptions to raise gross proceeds of approximately GBP1.6
million through the issue of a total of 2,318,643 new Ordinary
Shares (the Fund Raise Shares") at an issue price of 70 pence per
new Ordinary Share. The net proceeds of the Fund Raise of
approximately GBP1.5 million will be applied towards satisfying the
Acquisition Cash Consideration.
In addition, the Company is also pleased to confirm receipt of
the long-awaited UK tax clearances, which have in part delayed the
completion of the Acquisition. Accordingly, and subject to
additional demand from investors relying on such tax clearances,
the Company has made arrangements for a general private placing of
the Company's Ordinary Shares, at a price of 70 pence per Ordinary
Share, to be made available to those qualifying investors relying
on such tax clearances prior to completion of the Acquisition.
Commenting on the acquisition of Priori, Phillip Marcella, Chief
Executive of appScatter Group plc, said:
"I am delighted to have reached revised terms for the
acquisition by appScatter of Priori. I strongly believe that the
combination of the appScatter platform and the data held by Priori
will significantly advance the Company's development and
positioning. We are already collaborating with Priori on several
new high profile clients - with growing interest in the abilities
of the enlarged group from key potential enterprise customers.
"
Benefits of the Acquisition
The board of appScatter (the "Board") believes that the
Acquisition will significantly enhance the prospects of the
enlarged group and will allow the enlarged group to provide
significantly enhanced, market leading, data-led app insights. The
Board believes that these insights, when combined with Priori's
data intelligence software, will enhance the appScatter group's
ability to meet the increasing data demands of existing and
prospective customers.
Combining the businesses will create a source of data
intelligence drawing on 299 billion downloads across 5million apps
in 55 categories; as well as 6 billion devices in 52 territories
with appScatter data set the combined business intelligence will
support an additional 25 app stores across 175 territories.
About Priori
Founded in 2013, Priori is a B2B SaaS platform provider of
mobile app intelligence based in Berlin, Germany with proprietary
core data intelligence software and 16 full time employees with
experience in monetising app market data, including data
scientists, engineers and sales.
Priori's data is sourced from more than six billion unique user
devices in 252 territories and Priori's proprietary core machine
learning data intelligence software provides intelligence across
keywords, apps, markets, usage and audience. Priori's active
customers include blue-chip multinational organisations.
Based on unaudited management information, in the financial year
ended 31 December 2017, Priori had revenues of EUR1,056,000 (on a
cash-receipt basis) and recorded EBITDA losses of EUR410,000 (on a
net cash-receipts/cash-expense basis). On completion of the
proposed Acquisition, following the conversion of existing Priori
loan notes, Priori is expected to have unaudited estimated net
assets of approximately EUR39,000.
Authority to issue shares
The Board will use the authorities proposed under resolutions
8(c) and 9 at the forthcoming AGM on 29 June 2018 at 10.00 a.m. at
the offices of FTI Consulting, 200 Aldersgate Street, London EC1A
4HD to complete the Acquisition. If the necessary resolutions are
not passed at the AGM, the Company will be unable to issue the
Consideration Shares and the Fund Raise Shares and the Acquisition
will therefore not proceed.
Total Voting Rights
On completion of the Acquisition, and following the issue of
Consideration Shares (including the Deferred Shares) and the Fund
Raise Shares (together the "New Ordinary Shares"), the Company will
have 86,556,261 Ordinary Shares in issue. No Ordinary Shares are
held in treasury. Application will be made to the London Stock
Exchange for the New Ordinary Shares, which will rank pari passu
with the Company's existing Ordinary shares on issue, to be
admitted to trading on AIM.
The Acquisition Agreement
Pursuant to a conditional acquisition agreement dated 26 June
2018 (the "Acquisition Agreement") between (1) the Company and (2)
Quixote Holdings UG, Lakestar I LP, Martin Rajcan, Priori Trust UG,
Seedcamp III LP and Calceus GmbH (together the "Sellers"), the
Company has agreed to acquire all the issued and to be issued
shares in Priori. The consideration under the Acquisition Agreement
is GBP13.5 million to be satisfied on completion through the
payment of the Cash Consideration and the issue of the
Consideration Shares.
Completion of the Acquisition is conditional on the passing, at
the AGM, of the resolutions which will be relied upon to issue the
Consideration Shares.
The parties have agreed a long stop date for completion of the
Acquisition of 3 July 2018.
Under the terms of the Acquisition Agreement, the Sellers have
agreed to indemnify the Company for:
(i) all claims, liabilities, costs and reasonable expenses
arising in connection with any legal dispute regarding the usage of
certain images on Priori's website in the past;
(ii) all claims, liabilities, costs and reasonable expenses
arising in connection from any violations of the laws with respect
to (i) bogus self-employment and (ii) minimum wage laws by Priori
(in each case, including but not limited to social security
contributions, taxes, fines and penalties and external costs with
respect to such matters);
(iii) all claims, liabilities, costs and reasonable expenses
arising in connection from any violations of the Protection Against
Unfair Dismissal Act by Priori in respect of its employees;
(iv) all claims, liabilities, costs and reasonable expenses
arising in connection with any convertible loan agreements made
between the Priori and certain lenders in 2013 and 2016; and
(v) all claims, liabilities, costs and reasonable expenses
arising in connection with any claim made by any employee of Priori
(whether current or former) or other person with respect to the
intellectual property rights or with respect Priori's proprietary
software.
Each of the Sellers are giving warranties in favour of the
Company as to title only. The management Sellers are giving a suite
of warranties in favour of the Company that are usual for this type
of transaction.
The aggregate liability of the Sellers for claims in respect of
title shall not exceed an amount equal to the Consideration and all
other claims, indemnity claims and all claims under the tax
covenant given by the Sellers shall not exceed an amount equal to
twenty-five per cent. (25%) of the Consideration. For the avoidance
of doubt, the aggregate liability of the Sellers in respect for any
and all claims shall under no circumstances exceed the
Consideration.
The management Sellers have agreed not to carry on or be
engaged, concerned or interested (whether directly or indirectly)
with the business of any other app analytics platform for a period
of 2 years following completion
of the Acquisition.
The Acquisition is conditional, inter alia, upon the approval of
appScatter shareholders of the necessary resolutions at the AGM. If
the necessary resolutions are not passed at the AGM, the
Acquisition will not proceed.
Lock-in and Orderly Market Arrangements
20.73 per cent. of the Consideration Shares, which will be
issued to Priori management, will be subject to a lock-in agreement
for an initial period of 12 months and an orderly market
arrangement for a further period of 12 months following the expiry
of the initial lock-in period. Consideration Shares to be issued to
Lake Star, a venture capital investor in Priori, representing 27.29
per cent of the Consideration Shares will be subject to an 18 month
orderly market arrangement. The remaining 51.98 per cent. of the
Consideration Shares to be issued to the other shareholders of
Priori, representing early angel investors shall be subject to a
lock-in agreement for an initial period of 6 months and an orderly
market arrangement for a further period of 12 months following the
expiry of the initial lock-in period.
For enquiries, please contact:
appScatter Group plc Tel: 020 7004 7212
Philip Marcella, Chief Executive Officer www.appscatter.com
Manish Kotecha, Finance Director
FTI Consulting Tel: 020 3727 1000
Financial Public Relations appScatter@fticonsulting.com
Matt Dixon / Adam Davidson / Niamh Fogarty
Smith & Williamson Corporate Finance Limited Tel: +44 (0)20 7131 4000
Nominated Adviser and Joint Broker www.smithandwilliamson.com
Azhic Basirov / Ben Jeynes / David Jones
Stifel
Joint Broker
Fred Walsh / Neil Shah / Ben Maddison Tel: +44 (0)20 7710 7600
www.stifel.com
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
About appScatter Group plc
appScatter is a scalable B2B SaaS platform that allows paying
users to distribute their apps to, and manage their apps on,
multiple app stores. Additionally, the centralised platform enables
app developers and publishers to manage and track performance of
their own and competing apps across all of the app stores on the
platform.
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of this information may apply. For further information, please
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END
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