TIDMFUTR
RNS Number : 5585R
Future PLC
01 March 2019
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR").
1 March 2019
Future plc
Acquisition of Mobile Nations
The Board of Future plc (LSE: FUTR, "Future", "the Group"), the
global platform for specialist media, today announces the
acquisition of MoNa Mobile Nations, LLC ("Mobile Nations"), a
leading global digital publisher focused on consumer electronics
and based in the US (the "Acquisition").
Mobile Nations is a global independent digital publisher focused
on consumer electronics, combining content, community and commerce
to deliver shopping enablement solutions, with its key brands
including Android Central, iMore, Windows Central and Thrifter.
Mobile Nations' brands educate and inspire a monthly audience of
over 40 million technology enthusiasts and support consumers in
making better-informed buying decisions for personal
electronics.
The initial cash consideration is $55 million with a further $5
million to be satisfied through the issue to the vendors of 615,166
new ordinary shares (the "Consideration Shares"). In addition, a
further variable deferred consideration up to a total value of $60
million will be paid, subject to meeting financial targets based on
the year ending 31 March 2020. The deferred consideration is
expected to be split equally between cash and the issuance of new
shares in Future, although Future retains the right to pay the full
balance in cash.
Transaction highlights and rationale
-- Clear strategic fit
o Supports strategy of seeking leadership in niche specialist
markets
o Complementary brands further diversify and strengthen
Company's presence in US
o Brands acquired focus on consumer electronics, combine
content, community and commerce to deliver shopping enablement
solutions
-- Include Android Central, iMore, Windows Central and
Thrifter
-- Monthly audience of over 40 million technology
enthusiasts
o Strong existing commercial relationship through longstanding
partnership with Purch, acquired by Group in September 2018
o Significant further opportunities available through sharing of
best practice
-- Compelling financial rationale
o Mobile Nations achieved revenue of $16.4 million and EBITDA of
$8.2 million in year ended 31 December 2018
-- Organic revenue growth of 31% and EBITDA growth of 52%
yoy
o Transaction expected to be earnings enhancing in the current
financial year and materially earnings enhancing in the first full
year following completion
-- Total consideration of up to US$120 million
o Initial cash consideration of US$55 million, with further $5
million in shares
o Further variable deferred consideration up to total value of
$60 million, subject to certain financial targets based on the year
ending 31 March 2020. Deferred consideration to be split equally
between cash and issuance of new shares in Future, although Future
retains the right to pay the full balance in cash
o Initial cash consideration funded via Group's existing debt
facilities
-- Cash generative nature of Group will ensure debt profile reduces quickly over the year
The Company has made applications for the Consideration Shares
to be admitted to the standard segment of the Official List and to
the London Stock Exchange's main market for listed securities
("Admission"). The Company expects Admission to occur at 8am on 4
March 2019.
Mobile Nations was advised by JEGI, a leading independent
investment bank focused on media, marketing, information and
technology, on this transaction.
Zillah Byng-Thorne, CEO of Future, commented:
"This acquisition will further strengthen our market leading
position in technology and extend our growing presence in the US.
Mobile Nations' consumer electronics brands, which combine content,
community and commerce to deliver shopping enablement solutions,
are highly complementary to our existing portfolio.
"We already have an established commercial relationship with
Mobile Nations through its longstanding partnership with Purch,
which we acquired in September 2018. The addition of Mobile
Nations' brands will deepen our presence and expand our
opportunities to monetise our significant US online audience.
"We have identified a number of areas where we can share best
practice as we continue to leverage our specialist media platform
and diversify our revenue streams, both geographically and across
our product offering."
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR").
Enquiries
Future plc 01225 442244
Zillah Byng-Thorne, Chief Executive Officer
-------------
Penny Ladkin-Brand, Chief Financial Officer
-------------
020 7260
Numis Securities Limited (Financial Adviser to Future) 1000
-------------
Nick Westlake, Mark Lander, Hugo Rubinstein
-------------
020 7457
Instinctif Partners 2020
-------------
Kay Larsen, Chantal Woolcock
-------------
Note to editors
Future is a global platform business for specialist media with
diversified revenue streams.
The Media division is high-growth with three complementary
revenue streams: eCommerce, events and digital advertising. It
operates in a number of sectors including technology, games, music,
home interest, hobbies and B2B and its brands include TechRadar, PC
Gamer, Tom's Guide, Homebuilding & Renovating Show,
GamesRadar+, The Photography Show, Top Ten Reviews, Live Science,
Guitar World, MusicRadar, Space.com and Tom's Hardware.
The Magazine division focuses on publishing specialist content,
with over 80 publications and over 520 bookazines published per
year, totalling global circulation of 1.3 million. The Magazine
portfolio spans technology, games and entertainment, music,
creative and photography, hobbies, home interest and B2B. Its
titles include Classic Rock, Guitar Player, FourFourTwo,
Homebuilding & Renovating, Digital Camera, Guitarist, How It
Works, Total Film, What Hi-Fi? and Music Week.
Details of the acquisition
Mobile Nations is a global independent digital publisher focused
on consumer electronics, combining content, community and commerce
to deliver shopping enablement solutions, with its key brands
including Android Central, iMore, Windows Central and Thrifter.
Mobile Nations' brands educate and inspire a monthly audience of
over 40 million technology enthusiasts and support consumers in
making better-informed buying decisions for personal
electronics.
The acquisition of these complementary brands further
diversifies the Company's operations into the US and supports the
Company's strategy of seeking market leadership in the niche
markets that it serves. The Directors also believe there are
significant further opportunities available to Mobile Nations
through the sharing of best practice across the two businesses.
Mobile Nations has a strong existing commercial relationship with
the Group through its longstanding partnership with Purch, which
was acquired by the Group in September 2018.
In the year ended 31 December 2018, Mobile Nations achieved
revenue of $16.4 million and EBITDA of $8.2 million. This
represented organic revenue growth of 31% and EBITDA growth of 52%
compared to the previous financial year. The transaction is
expected to be earnings enhancing in the current financial year and
materially earnings enhancing in the first full year following
completion.
An initial consideration of US$55 million (subject to normal
working capital adjustments) is to be paid in cash on completion
with a further $5 million to be satisfied through the issue to the
Consideration Shares. The initial cash consideration is to be
funded via the Group's existing debt facilities.
The total level of variable deferred consideration payable will
be based on Mobile Nations achieving financial targets based on the
year ending 31 March 2020 and is capped at $60 million. Payment of
the maximum level of deferred consideration would depend on Mobile
Nations achieving stretching profit targets. It is expected that
the payment of the variable deferred consideration will be split
equally between cash and the issue of new ordinary shares in
Future. The Company retains an option to increase the proportion of
the deferred consideration to be paid in cash rather than through
the issuance of new shares. Both the Consideration Shares and any
shares issued pursuant to the deferred consideration will be
subject to customary lock-up arrangements.
As announced on 14 February, 2019, Future recently signed a new
GBP90 million debt facility with improved terms on previous
arrangements, with an initial maturity of February 2023 and an
incremental uncommitted GBP45 million accordion, providing
additional flexibility.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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