dotDigital Group plc Acquisition of Comapi (1666X)
22 November 2017 - 6:01PM
UK Regulatory
TIDMDOTD
RNS Number : 1666X
dotDigital Group plc
22 November 2017
dotdigital Group Plc
("dotdigital", "Company" or the "Group")
Acquisition of Comapi
dotdigital Group Plc (AIM:DOTD), the leading provider of
intuitive software as a service ("SaaS") and managed services to
digital marketing professionals, through the 'dotmailer' platform,
announces that it has completed the acquisition of the Comapi group
of companies, ("Comapi") a fast-growing business focused on the
omni-channel messaging and cloud communication market, for a cash
consideration of GBP11 million (the "acquisition"). Potential
further consideration of up to GBP1.2 million in share options is
also payable to the management team dependant on them achieving
specific performance targets over a 2 year post-acquisition period
and remaining with the business.
Headquartered in Cheltenham with approximately 30 employees,
Comapi has built a scalable software platform that allows
businesses to communicate with their consumers across multiple
conversational messaging channels including the growing market for
live chat. Comapi's heavy investment in technology allows it to
compete in the CPaaS (communication platform as a service) and ARN
markets (alerts, reminders and notification), providing a flexible
API (application programming interface) based omni-channel
messaging platform and toolkit that facilitates easy integration
and rapid deployment to businesses requiring a personalised and
two-way customer engagement solution.
Acquisition highlights
The Directors believe the acquisition will:
-- Extend dotdigital's marketing automation platform to provide an industry leading solution offering fully
integrated omni-channel and conversational commerce support to marketers,
-- Enable dotdigital to deliver aligned conversational messaging across channels including email, mobile push, SMS,
Facebook messenger, Apple business messenger, Twitter and live chat
-- Enable dotdigital customers to meet consumer demand for a more personalised communication experience and
-- Position dotdigital as the most advanced platform on the market and make dotdigital more relevant in the
strategic mobile first Asian market.
Financial Information
Comapi had revenues of GBP7.8 million which are primarily
recurring and EBITDA of GBP1.2 million for the year ended December
2016. Revenues for Comapi in the current financial year are growing
at approximately 15% based on their SAAS business model. The board
expect there to be opportunities to further expand revenues once
the integrations have been completed. Comapi has just completed a
GBP2.7million R&D programme and on completion of the
transaction will have a positive net asset position. The two
subsidiaries combined are currently cash breakeven after spending
roughly GBP1.0 million on R&D in the current year.
dotDigital Chief Executive Officer, Milan Patel, commented:
"By adding Comapi to our business, dotdigital is executing on
its vision to be an omni-channel marketing automation platform.
Comapi has built an impressive platform that, integrated with our
software, will allow our customers access to the next generation of
consumer engagement marketing technology aiding retention and
boosting our competitive advantage in securing new customers.
In particular, this supports our KPI to grow both ARPU ("Average
revenue per user") and recurring revenues. We are pleased to
welcome the Comapi team and look forward to supporting their
business plan and introducing their technology to our global
customers."
Acquisition Rationale
dotdigital is committed to the ongoing enhancement of its
product platform to ensure it can meet the needs of the most
innovative and sophisticated marketers. The acquisition allows
dotdigital to better fulfil that aim by extending omni-channel
communications on its platform, helping customers communicate via
email, SMS, social messaging apps and live chat. This move will
allow dotdigital to keep pace with ever growing demand for
personalised and relevant communications experiences, and positions
the Group as the most advanced platform for these services on the
market. In allowing dotdigital and its subsidiaries (the "Group")
to offer a more comprehensive range of services, the acquisition
will help embed dotdigital at the heart of its customers' marketing
operations, enabling longer and more durable relationships.
dotdigital has previously stated its strategic ambition of
expanding in geographies beyond the UK. The acquisition supports
this aim by enabling easier access to more mobile-centric markets
including those in Asia where the Group is focusing considerable
attention. This is reinforced by recent research by
MarketsandMarkets which forecasts that the global mobile marketing
market will grow from USD 28.63 billion to USD 98.85 billion by
2021, with the fastest growing region expected to be APAC.
While the acquisition allows dotdigital to access another
high-quality and highly visible subscription-based revenue stream,
it also presents a significant benefit to both dotdigital's and
Comapi's existing customers. While the former will now be able to
gain easier access to the in-demand conversational messaging
ecosystem, the latter will be able to gain more easily interact
with dotdigital's core dotmailer product.
Terms of the acquisition and funding
Under the terms of the acquisition, dotdigital will pay GBP11
million in cash from the Group's existing reserves to acquire the
businesses and is confident that under its ownership it can
accelerate the businesses revenue and profit growth. Comapi is
profitable and will be managed as a wholly owned subsidiary of
dotdigital. The current management team is staying on to support
the product integration plan and to deliver the exciting business
plan to be a leading player in the fast growing CPaaS market.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
For further information please contact:
dotdigital Group Plc Tel: 020 3770 1502
Milan Patel, CEO
Phillip Blundell, CFO
----------------------------- --------------------------------
FTI Consulting (Financial Tel: 020 3727 1000
PR and Investor Relations)
Matt Dixon
Adam Davidson
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N+1 Singer (Nominated Tel: 020 7496 3000
Adviser and Joint Broker)
Shaun Dobson, Head of
Corporate Finance
Liz Yong, Corporate Finance
----------------------------- --------------------------------
finnCap (Joint Broker) Tel: 020 7220 0500
Stuart Andrews, Corporate
Finance
Rhys Williams, Sales
----------------------------- --------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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