TIDMDOTD
RNS Number : 5426L
dotDigital Group plc
06 September 2023
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF THE MARKET ABUSE REGULATION (EU 596 / 2014) WHICH IS PART OF UK
LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018. UPON
PUBLICATION OF THIS ANNOUNCEMENT, THIS INFORMATION IS NOW
CONSIDERED TO BE IN THE PUBLIC DOMAIN
Dotdigital Group plc
("Dotdigital" or the "Group")
Dotdigital acquires Fresh Relevance
Acquisition of personalisation platform strengthens Dotdigital's
CXDP offering
Dotdigital Group plc (AIM: DOTD), the leading SaaS provider of
an all-in-one customer experience and data platform (CXDP), is
pleased to announce the acquisition of Fresh Relevance Limited
("Fresh Relevance"), a vendor of cross-channel personalisation
technology ("the Acquisition").
Highlights:
-- Acquisition accelerates Dotdigital's CXDP roadmap, bringing
highly complementary cross-channel personalisation and
website technology together with technical expertise
-- Increases the Group's addressable market, enabling the
acquisition of higher value customers and supporting customer
retention by providing the means to expand its role in
existing customers' technology stacks
-- Strong existing relationship between Dotdigital and Fresh
Relevance, with established technology integration and
shared values and culture
-- Expected to add over GBP6.0m of annual revenues, of which
93% are recurring SaaS revenue, and GBP0.6m annual EBITDA
before integration costs
-- Revenue and cost synergies over the medium term and is
expected to be earnings enhancing in the financial year
ending 30 June 2025
About Fresh Relevance
Fresh Relevance was founded in 2013 and operates from its
offices in London and Southampton. The platform increases
conversions and boosts revenues by using data to personalise
customer experiences across web, email, mobile app, SMS and ads.
Capabilities include triggered emails, product recommendations,
onsite popovers, dynamic content, behavioural and geotargeting,
optimisation and customer data management. Fresh Relevance has more
than 300 customers around the world spanning consumer and B2B
ecommerce and travel. Customers include Rip Curl, Dreams, Hoseasons
and Wowcher.
Background to and Reasons for the Acquisition
The acquisition brings highly complementary personalisation
technology and website expertise to the Group, supporting marketers
in delivering exceptional customer experiences across all customer
touchpoints. Personalisation is a growing trend: 76% of consumers
say they're more likely to purchase from brands that personalise
interactions(1) , with websites often representing the final
gateway to customer conversion. This is reflected in the investment
choices of marketers, with one third of marketers spending 50% or
more of their budgets on personalisation(2) and two thirds of North
American and European eCommerce companies planning to invest more
into it in the future(3) .
Dotdigital and Fresh Relevance have a strong existing
relationship and a proven track record of joint success. Having
worked together in a partnership capacity for years, the two firms
share a number of joint customers that utilise the existing
technology integration.
As part of Dotdigital, Fresh Relevance will operate under its
existing brand. The integration of Fresh Relevance into the Group
will be overseen by Dotdigital's newly appointed Chief Business
Operations Officer, Helen Thomazin (a non-Board position), and
Fresh Relevance CEO and co-founder, Mike Austin, who will join the
Dotdigital leadership team (also non-Board).
As long-standing partners, Dotdigital and Fresh Relevance
already have a level of integration where the technology works
hand-in-hand to deliver memorable cross-channel experiences with
hyper targeting and personalisation across all stages of a
customer's journey. Over the next 12 months, the Group will be
leveraging the functionality of the Fresh Relevance platform and
integrating this into the Dotdigital experience platform to enable
a more seamless user experience for customers as part of its vision
of launching a differentiated all-in-one CXDP. This will create a
higher value proposition and provide revenue expansion
opportunities across both customer bases, as well as open up
substantial new, higher value customer acquisition opportunities.
Dotdigital will leverage Fresh Relevance's capabilities and
experience specifically in website journey orchestration,
personalisation and optimisation, not just for known identifiable
customers but also the 95%-98% of visitors that are anonymous.
Consideration
Dotdigital is paying a total consideration of GBP25.0 million,
100% payable on completion, with c.GBP18.9 million being satisfied
in cash and c.GBP6.1 million by the issue of 6,862,683 new ordinary
shares in Dotdigital at 88.698p, which are subject to a 12 month
lock-in.
The cash portion of the consideration will be funded through the
Group's own cash reserves. Post Acquisition, the Group will have a
cash balance of GBP38.3m giving the flexibility to look at further
strategic acquisition opportunities.
The Acquisition will complete on admission of the equity shares
to trading on AIM.
Milan Patel, Chief Executive Officer of Dotdigital,
commented:
"The acquisition of Fresh Relevance and its expertise in the
realm of web significantly enhances our personalisation
capabilities and provides opportunity for average revenue per user
expansion. Its addition marks a leap forward in our CXDP growth
journey, bringing together customer insights, cross-channel
engagement, and on-site personalisation capabilities to provide
marketers with the tools to exert greater influence across the
customer journey.
Having worked together as partners for five years, we have been
long-term admirers of Fresh Relevance and its talented staff. Our
cultural alignment gives me confidence that customers old and new
will reap the benefits of a more comprehensive offering that
extends beyond traditional marketing channels.
On behalf of the Board and everyone at Dotdigital I would like
to welcome Fresh Relevance to the organisation. I look forward to
working closely with them to achieve our shared ambitions and drive
increased value for the Group's shareholders."
(1) McKinsey: The value of getting personalization right-or
wrong-is multiplying
(2) Adobe: Study: Where is Personalization Missing the Mark?
(3) Statista: Share of e-commerce companies planning on
investing more in personalization in North America and Europe in
2021
Admission
An application has been made for 6,862,683 new ordinary shares,
to be issued to satisfy the equity consideration for the
Acquisition, to be admitted to trading on AIM ("Admission").
Admission is expected to occur on 11 September 2023. Following
Admission, the Company will have 306,078,813 ordinary shares in
issue admitted to trading on AIM, which figure may be used by
shareholders in the Company as the denominator for the calculations
by which they will determine if they are required to notify their
interest in, or a change in their interest in, the share capital of
the Company under the FCA's Disclosure and Transparency Rules. Of
this total 660,000 ordinary shares are held in treasury.
Dotdigital Group Plc Tel: 020 3953 3072
Milan Patel, CEO investorrelations@dotdigital.com
Alistair Gurney, CFO
Alma PR (Financial PR) Tel: 020 3405 0210
Hilary Buchanan dotdigital@almapr.co.uk
David Ison
Kieran Breheny
Canaccord Genuity (Nominated Advisor and Joint Broker) Tel: 020 7523 8000
Bobbie Hilliam, Corporate Finance
Jonathan Barr, Sales
finnCap (Joint Broker) Tel: 020 7220 0500
Jonny Franklin Adams, Corporate Finance
Singer Capital Markets (Joint Broker) Tel: 020 7496 3000
Shaun Dobson, Corporate Finance
Alex Bond, Corporate Finance
About Dotdigital
Dotdigital Group plc (AIM: DOTD) is a leading provider of
cross-channel marketing automation technology to marketing
professionals. Dotdigital's customer experience and data platform
(CXDP) combines the power of automation and AI to help businesses
deliver hyper-relevant customer experiences at scale. With
Dotdigital, marketing teams can unify and enrich their customer
data, identify valuable customer segments, and deliver personalised
cross-channel customer journeys that result in engagements,
conversions, and loyalty.
Founded in 1999, Dotdigital is headquartered in London with
offices in Croydon, Manchester, New York, Melbourne, Sydney,
Singapore, Cape Town, and Warsaw. Dotdigital's solutions empower
over 4,000 brands across 150 countries.
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