Transaction Values Fluent at $415 Million
with Additional Contribution by BlueFocus of $100 Million in Cash,
Canadian-Based Marketing Communications Company Vision7
International, and U.K.-Based Global Socially-Led Creative Agency
We Are Social
Data and Analytics Company to Spin-Off into
Standalone Public Company with Proposed Listing on NASDAQ;
Dedicated Focus on Innovation and Big Data Analytics to Drive
Continued Expansion in Multi-Billion Dollar Market
cogint Shareholders Expected to Receive Cash
Dividend and Shares of Data and Analytics Company Common Stock in
Connection with Closing the Business Combination
cogint Shareholders and BlueFocus to Own 37%
and 63% respectively of the Combined Marketing Services
Company
Creates World-Class Global Marketing
Services Company Powered by Creative, Digital and Performance
Marketing Capabilities
Cogint, Inc. (NASDAQ:COGT) today announced it has entered into a
definitive transaction agreement with BlueFocus International
Limited (“BlueFocus”), a wholly-owned Hong Kong subsidiary of
BlueFocus Communications Group Co. Ltd. (publicly traded Chinese
Company (SHE:300058)) under which cogint and BlueFocus will combine
their businesses. In the transaction, BlueFocus will contribute to
cogint (1) $100 million in cash, (2) Canadian-based marketing
communications company Vision7 International Inc., (3) U.K.-based
global socially-led creative agency We Are Very Social Limited, and
(4) Indigo Social, LLC. The transaction values cogint’s
performance-marketing business, Fluent, at $415 million. The
combined company is expected to have 2018 annual revenues in excess
of $500 million and adjusted EBITDA in excess of $75 million, with
customers around the globe.
cogint, through its data-driven, performance marketing solutions
company Fluent, has established a leading franchise of
differentiated, innovative products in the digital marketing
industry that is highly complementary to the existing portfolio of
BlueFocus. The combination provides Fluent with an immediate
international presence with access to the world’s leading brands,
and delivers differentiated, end-to-end solutions consisting of
Fluent’s unique customer acquisition and retention capabilities and
BlueFocus’s premier agency and creative services. BlueFocus will
retain Fluent’s presence in New York City and Fluent will continue
to be led by Ryan Schulke and Matt Conlin.
As part of the transaction, immediately prior to the closing,
cogint will spin-off its data and analytics operations and assets
into a public company, expected to be listed on NASDAQ, named Red
Violet, Inc. (“Red Violet”). The shares of Red Violet will be
distributed to cogint’s shareholders as of a record date to be
determined as a stock dividend upon closing of the transaction. The
arrangements will result in Red Violet launching with cash of $20
million dollars. Red Violet will be led by cogint’s current
management team with Derek Dubner, co-founder and Chief Executive
Officer of cogint, as Chief Executive Officer. Michael Brauser,
co-founder and Chairman of the Board of cogint, will be Chairman of
the Board of Red Violet.
“I’m very proud that we have created such an extraordinary value
proposition through this structured transaction,” said Michael
Brauser, cogint’s Chairman. “Since the day we founded cogint, we
have worked tirelessly to create enormous value for our
shareholders. This transaction does exactly that by providing a
significant value premium to our shareholders, a cash dividend, and
ownership in two publicly-traded companies with tremendous future
upside.”
“Fluent is uniquely positioned as the go-to data-driven,
performance marketing company for top brands to engage with
customers at massive scale,” said Derek Dubner, cogint’s CEO.
“Combining Fluent with BlueFocus’s international portfolio of
marketing services businesses is a compelling opportunity for
Fluent to achieve international scale and to integrate its unique
ability to build custom audiences for the world’s leading brands
with the BlueFocus portfolio of services. I am equally excited to
announce the spin-off of our data and analytics company and its new
brand identity, Red Violet. Red Violet is strongly positioned to
leverage its innovative technologies to power its continued
expansion within the risk management industry. This structured
transaction enhances the strategic focus and respective competitive
positions of both cogint companies.”
Benefits of the Transaction
- Compelling
transaction for cogint shareholders: The transaction
will deliver a significant and immediate premium to cogint
shareholders, with greater value certainty resulting from the
combination of cogint’s performance marketing business with
BlueFocus’s marketing services companies, as compared to cogint’s
performance marketing business’s standalone prospects. cogint’s
shareholders will also receive a cash dividend and are also
expected to realize substantial additional value from their
ownership interest in Red Violet’s spin-off.
- Additional
value creation through separation of businesses: As
cogint’s risk management and performance marketing businesses have
distinct financial and operating characteristics, the separation of
the businesses will simplify the management and organization
structures of each company, allowing each company to adopt
strategies and pursue objectives appropriate to their respective
needs to focus more exclusively on improving each company's
operations, and to enable the optimization of capital deployment
and investment strategies necessary to advance their respective
compelling innovation roadmaps. Further, the separation brings
greater clarity to the market place as to each company’s core
competencies, allowing each company to compete more effectively
within their respective markets.
- Greater
visibility into cogint businesses: The separation of
cogint’s risk management and performance marketing businesses
enables investors to better evaluate the financial performance,
strategies, and other characteristics of each company. This will
permit investors to make investment decisions based on each
company's own performance and potential, and enhance the likelihood
that the market will value each company appropriately.
cogint shareholders holding in aggregate 58.0% of the Company's
common stock have approved, by written consent, the issuance of
cogint shares to BlueFocus and other matters relating to the
business combination. The company expects to mail to its
shareholders an Information Statement describing the business
combination in detail. Closing of the transaction is conditioned on
the mailing of the Information Statement to cogint shareholders,
completion of the spin-off, and appropriate regulatory
approvals.
Advisors
Petsky Prunier is acting as exclusive financial advisor to
Cogint, Inc. PJT Partners is acting as financial advisor to
BlueFocus International Limited.
About cogint™
At cogint, we believe that time is your most valuable asset.
Through powerful analytics, we transform data into intelligence, in
a fast and efficient manner, so that our clients can spend their
time on what matters most – running their organizations with
confidence. Through leading-edge, proprietary technology and a
massive data repository, our data and analytical solutions harness
the power of data fusion, uncovering the relevance of disparate
data points and converting them into comprehensive and insightful
views of people, businesses, assets and their interrelationships.
We empower clients across markets and industries to better execute
all aspects of their business, from managing risk, conducting
investigations, identifying fraud and abuse, and collecting debts,
to identifying and acquiring new customers. At cogint, we are
dedicated to making the world a safer place, to reducing the cost
of doing business, and to enhancing the consumer experience.
Note to Investors Concerning Forward-Looking
Statements
This press release contains “forward-looking statements,” as
that term is defined under the Private Securities Litigation Reform
Act of 1995 (PSLRA), which statements may be identified by words
such as “expects,” “plans,” “projects,” “will,” “may,”
“anticipate,” “believes,” “should,” “intends,” “estimates,” and
other words of similar meaning. Such forward looking statements
include statements relating to the transaction between cogint and
BlueFocus, expected annual revenues and EBITDA of the combined
company, the delivery of a significant and immediate premium to
cogint shareholders, the spin-off of cogint’s data and analytics
operations and assets into a new public company, and the additional
value creation through the separation of such operations and
assets. Additional risks may include the risk that a condition to
closing of the proposed transaction may not be satisfied or that
the closing of the proposed transaction and spin-off might
otherwise not occur; the risk that a regulatory approval that may
be required for the proposed transaction is not obtained or is
obtained subject to conditions that are not anticipated; the
diversion of management time on transaction-related issues; the
ability to successfully integrate BlueFocus’s business; the ability
to successfully separate cogint’s data and analytics operations and
assets; the risk that the common stock of Red Violet is not listed
on NASDAQ; the risk that the transaction and its announcement could
have an adverse effect on cogint’s and BlueFocus’s ability to
retain customers and retain and hire key personnel; the risk that
any potential synergies from the transaction may not be fully
realized or may take longer to realize than expected, as well as
other non-historical statements about our expectations, beliefs or
intentions regarding our business, technologies and products,
financial condition, strategies or prospects. Readers are cautioned
not to place undue reliance on these forward-looking statements,
which are based on our expectations as of the date of this press
release and speak only as of the date of this press release and are
advised to consider the factors listed above together with the
additional factors under the heading “Forward-Looking Statements”
and “Risk Factors” in the Company’s Annual Report on Form 10-K, as
may be supplemented or amended by the Company’s Quarterly Reports
on Form 10-Q and other SEC filings. We undertake no obligation to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events or otherwise.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170907005735/en/
Cogint, Inc.Jordyn Kopin, 646-356-8469Director, Investor
RelationsJKopin@cogint.com
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