TIDMMERI
RNS Number : 6940A
Merian Chrysalis Investment Co. Ltd
01 October 2020
For immediate release
The information contained in this announcement is restricted and
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Merian Chrysalis Investment Company Limited
1 October 2020
Merian Chrysalis Investment Company Limited (the "Company")
Portfolio Update
Update on "Target" Investment
The Company can now confirm that the "Target" investment
referred to in its announcement dated 28 September 2020 is You
& Mr Jones LLC ("You & Mr Jones").
Today, the Company is pleased to announce that is has finalised
its due diligence on You & Mr Jones and committed to invest
US$60 million as part of a US$260 million funding round.
In just five years, You & Mr Jones has established itself as
one the world's leading marketing technology groups, delivering
enterprise-level marketing technology solutions to the world's
biggest brands.
You & Mr Jones was founded by David Jones and Jean-Marc
Antoni who were formerly the CEO and CFO of Havas & Havas
Worldwide, one of the largest marketing and communications groups
globally. The company, which identifies itself as the world's first
"Brandtech(TM)" group, has raised over US$500 million to date and
has acquired and integrated what it believes to be best-in-class
digital and mobile technology service providers which enable brands
to execute their marketing strategies "better, faster, and
cheaper".
The largest company within the You & Mr Jones group is
Oliver. Oliver is the pioneer and global leader in building
in-house digital marketing capabilities for brands. Oliver has
developed a technology platform that enables marketers to plan,
create and disseminate digital campaigns seamlessly. Given the
rapidly changing face of digital marketing, this operating system
offers a significant productivity boost to clients and has enabled
some to make material cost savings.
You & Mr Jones is headquartered in New York (US), employs
approximately 3,000 people across 40 countries and has made seven
acquisitions and 20 strategic investments to date. Current clients
include Unilever, Adidas, Microsoft, Danone, Diageo, Reebok,
Reckitt Benckiser, PayPal and Google.
Investment Thesis
Merian Global Investors (UK) Limited (the "Investment Adviser")
believes that few sectors are as ripe for disruption as the
marketing and communications sector.
In the Investment Adviser's view, the future of marketing will
rely on the expert curation of multiple service providers, combined
with next-generation marketing intelligence. It further believes
that data, content and media will need to be connected and
optimised in real-time via a central technology platform and
AI.
In addition, the continued fragmentation of media and the
broadening diversity of audiences is likely to lead to an
unprecedented level of complexity for brand owners.
By building a collaborative model from the outset, the
Investment Adviser believes You & Mr Jones has designed an
operating model for the future, where multiple service providers
can be utilised at ease through a core technology platform,
creating a marketplace of expertise through a single point of
contact.
Investment Rationale
You & Mr Jones:
(1) operates in a very large market and controls only a small
market share:
Total global media spend totals US$640 billion per annum and
over US$260 billion of that spend is now allocated to digital
channels (source: Zenith Optimedia, 2019). Digital channel growth
continues apace with other marketing channels in structural
decline. Many traditional marketing agencies appear unable to
transition their business models to adapt to the demands of
customers that are seeking digitally coherent services and
infrastructure. Companies are looking for a partner who can deliver
scalable solutions that allow them to deliver the volume of content
they now need, at the speed they need it at, at an affordable
cost.
(2) provides technology and solutions that are significantly
disrupting incumbents:
You & Mr Jones leverages technology, in-housing and
people-powered marketing to enable marketers to realise material
cost savings. These savings can either be taken to the bottom line
or reinvested in additional marketing campaigns.
(3) has displayed significant growth over many years and given
barriers to entry, has the potential to continue to do so:
You & Mr Jones generated a +27% rate of organic net revenue
growth during the first half of the year (source:
Mobilemarketer.com) which the Investment Adviser believes to be
best-in-class. This is particularly impressive given the already
material revenue base and the impact of COVID-19.
(4) has the ability to drive economies of scale through its
operating model:
As brands transition from analogue to digital, You & Mr
Jones is likely to have the opportunity to create and curate an
increasing level of digital content which will drive operational
efficiencies. As part of this process, technology can be harnessed
to automate the production of digital assets.
The business has also developed a proprietary technology
platform that enhances the productivity and functionality of
various business units including clients, digital asset production,
pricing and distribution.
(5) has a strong and well-respected management team
David Jones (CEO) and Jean-Marc Antoni (CFO) have an exceptional
track record and a strong reputation. They know the industry
extremely well given their senior roles at Havas, one of the
world's largest media conglomerates. They have assembled an
extremely talented group of senior partners in the company.
Funding
Completion of the investment will take place in due course and
it is the Company's current intention to use the proceeds of the
proposed placing of equity, announced on 28 September 2020, to fund
the investment in You & Mr Jones. There has been a positive
response so far to the Placing from both new and existing
investors.
Richard Watts, portfolio manager, comments:
"We are extremely excited to announce our investment into You
& Mr Jones. At IPO we set a target of generating significant
returns on investment, and we believe You & Mr Jones offers
this possibility. We have a strong track record of investing in
media and technology assets across the Jupiter UK small- and
mid-cap desk and we firmly believe that You & Mr Jones is well
positioned to capitalise on an enormous opportunity."
Nick Williamson, portfolio manager, comments:
"You & Mr Jones fits our investment strategy and criteria
perfectly. It is a late-stage asset with a highly disruptive
offering, very material revenue streams, is profitable and has a
world-class management team and client list. This investment also
diversifies our sector exposure and represents a significant
milestone, given that it is the Company's first investment outside
of Europe."
David Jones, CEO, You & Mr Jones, adds:
" We had a very strong first nine months of the year delivering
exceptional organic growth, underscoring the strength and relevance
of our technology-driven business model and the extent to which
brandtech is disrupting the traditional category. We're excited to
have Merian Chrysalis join our prestigious group of investors as we
continue to build the global leader in providing enterprise level,
technology-driven marketing solutions to the world's biggest
brands"
BofA Securities acted as Introduction Agent to You & Mr
Jones.
-S-
For further information, please contact:
Merian Global Investors:
Amelie Shepherd +44 (0) 20 3817 1686
Liberum Capital Limited:
Gillian Martin / Owen Matthews +44 (0) 20 3100 2000
---------------------
Numis Securities Limited:
Nathan Brown/David Benda +44 (0) 20 7260 1000
---------------------
Maitland Administration (Guernsey)
Limited:
Elaine Smeja +44 (0) 1481 749364
---------------------
LEI: 213800F9SQ753JQHSW24
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