TIDMIMO
RNS Number : 5392A
IMImobile PLC
27 March 2017
IMImobile PLC
("IMImobile" or the "Company" or the "Group")
Acquisition of Infracast Limited
IMImobile, a cloud communications software and solutions
provider, is pleased to announce that it has agreed to acquire
Infracast Limited ("Infracast"), a leading provider of
multi-channel messaging applications and middleware
("Acquisition"). The Acquisition is highly complementary to both
IMImobile's product set and customer base and is expected to be
immediately earnings enhancing for the Group.
Highlights:
-- Infracast is a leading technology partner to Telefonica, and
through that partnership provides services to a number of tier one
banks. Following the integration of the Acquisition, the enlarged
Group will provide communication software and services to four of
the top five tier one retail banking groups in the UK.
-- Initial consideration of GBP8.2m payable in cash and shares
on completion with a further deferred consideration based on
Infracast meeting gross profit and EBITDA targets over the next
three years.
-- Good track record of revenue and gross profit growth, with
over 90% recurring revenues. Reported revenue and gross profit of
GBP10.4m and GBP3.1m, respectively, for the year ending 31 May
2016.
-- The Acquisition is expected to enhance Group earnings during the year ending 31 March 2018.
-- Infracast's customer and product portfolio is complementary
to existing IMImobile products and solutions, providing significant
cross-sell and up-sell opportunities.
-- The Infracast Platform to be integrated with IMImobile's core
cloud infrastructure with identified operational synergies.
-- There are significant opportunities to leverage IMImobile's
global mobile operator footprint to introduce Infracast's telecom
offering into international markets.
Commenting on the Acquisition Jay Patel, Chief Executive Officer
of IMImobile said:
"The acquisition of Infracast helps us strengthen our
capabilities and opportunities in the financial services sector, a
sector which is profoundly impacted by the shift of consumer
behaviour towards digital and mobile technologies. We expect to
rapidly integrate the acquisition over the next six months and take
advantage of the close synergies in terms of technology,
partnerships, client base and the experienced senior management
team."
Background to and reasons for the Acquisition
IMImobile believes that Infracast has a leading middleware
platform for the secure and resilient management of mobile
messaging in the financial services sector and for optimising
messaging volumes into mobile operator infrastructure. This
capability will complement IMImobile's business, allowing both
businesses to cross-sell and up-sell the enhanced suite of services
to tier one banks and mobile operators in the UK and
internationally.
A key attraction of the Acquisition for IMImobile was the
experienced Infracast senior management team, who have successfully
developed the technology and established a track record of
delivering revenues, profits and cash flow. As such, the founder
David Angers and the commercial director Chris Hicks have agreed to
remain part of the wider Group and will join IMImobile's senior
management team.
Infracast meets all of IMImobile's acquisition criteria of
purchasing companies with established recurring revenue contracts
with large blue-chip enterprises, with over 90% recurring revenues.
It has a complementary product set, a good financial record and
opportunities for revenue and cost synergies.
Further information on Infracast
Infracast is based in Reading and employs 31 people. In the year
ended 31 May 2016, Infracast reported a turnover of GBP10.4m, gross
profit of GBP3.1m and EBITDA of GBP0.4m. Infracast has enjoyed
strong growth during the period since these results. As at 31 May
2016, being the date of Infracast's latest published audited
financial statements, it had net assets of GBP0.3m.
Terms of the Acquisition
The initial consideration for the Acquisition is GBP8.2 million,
comprising cash of GBP7.7m (GBP7.4m net of excess cash acquired)
and GBP0.5m in shares satisfied by the issue of 273,614 ordinary
shares at a price of GBP1.75 per share with additional deferred
payments of up to a maximum aggregate value of GBP8.8m, split over
three years based on a mix of gross profit growth and EBITDA
targets, with an anticipated value of between GBP3 million and GBP5
million. The deferred consideration will be satisfied either in
cash or shares at the option of the Company.
The initial cash consideration will be met from the Group's
existing cash resources. The deferred consideration will be shared
amongst the founders of the business and senior management
providing IMImobile with a motivated and committed team to leverage
Infracast's technology across IMImobile's geographic regions.
This announcement contains inside information as stipulated
under the Market Abuse Regulations (EU) no. 596/2014 ("MAR")
For further information please contact:
IMImobile PLC c/o Redleaf Communications
Jay Patel, Chief Executive Officer Tel: +44 (0)20 7382
Mike Jefferies, Chief Financial Officer 4769
Redleaf Communications - PR adviser Tel: +44 (0)20 7382
Charlie Geller 4769
Sam Modlin imimobile@redleafpr.com
Investec Bank - Nominated Adviser and Joint Broker Tel: +44 (0)207 597
Dominic Emery 5970
Henry Reast
Whitman Howard - Joint Broker Tel: +44 (0) 207
Ranald McGregor-Smith 659 1234
Francis North
About IMImobile PLC
IMImobile is a cloud communications software and solutions
provider that enables companies to use mobile and digital
technologies to communicate and engage with their customers.
Organisations that trust us to deliver smarter digital customer
engagement solutions include Vodafone, Telefonica, Aircel, Airtel,
EE, BSNL, AT&T, MTN, France Telecom, Centrica, Universal Music,
Tata, the AA, the BBC and major financial institutions.
IMImobile is headquartered in London with offices in Hyderabad,
Atlanta, Dubai and Johannesburg and has over 900 employees
worldwide. IMImobile is quoted on the London Stock Exchange's AIM
market with the TIDM code IMO.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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