Acquisition
05 January 2007 - 6:01PM
UK Regulatory
RNS Number:0251P
Real Affinity PLC
05 January 2007
Real Affinity plc
REAL AFFINITY ACQUIRES PR COMPANY
Real Affinity plc, ("Real Affinity" or "the Company"), the AIM-listed marketing
services group, announces that it has agreed to acquire the whole of the issued
share capital of Corporate Hospitality Services Ltd (which trades as CHS Ltd),
for an initial consideration of #50,000, to be satisfied by the issue of
45,454,545 new Ordinary shares of the Company at 0.11p per share. CHS Ltd is a
PR and corporate hospitality business which was established in September 1997.
The acquisition is conditional on the admission of the initial consideration
shares to trading on AIM. Further deferred consideration of up to #930,000 (in a
combination of new Ordinary shares and cash) will be payable on the achievement
of certain performance targets as detailed below.
Gerard Corcoran, Group Chief Executive of Real Affinity, said:
"The acquisition of CHS Ltd is in line with our strategy to provide a broader
range of integrated services to our clients. PR is a key area of opportunity and
it is important for us to be able to offer high quality PR services to our
current and potential clients. CHS Ltd will also provide the foundation on which
to build a larger PR team by allowing us to bring other well established PR
practitioners into an existing structure.
"CHS Ltd works with leading businesses such as BT and KPMG and, under the
leadership of its current directors, Ashley Metcalfe, the former Yorkshire
cricketer, and Joanne Rawnsley, we expect the business to continue to expand.
CHS Ltd will also look to develop business throughout the UK, but particularly
in the North, for other Real Affinity companies involved in event marketing,
such as Holly Benson and Venues Unlimited. CHS Ltd will re-locate to Real
Affinity's Bradford office immediately and will be rebranded in due course."
Ashley Metcalfe, Director of CHS Ltd, commented:
"This is an exciting opportunity to join a fast growing, forward thinking
marketing group that already has a high quality client base with regional,
national and international profile. We are looking forward to bringing our
experience in consumer, business to business and sports PR to the group, along
with our extensive understanding of the events and corporate hospitality market.
At the same time we will ensure our current clients will continue to receive the
same close personal attention we have always given them."
Deferred share consideration of a maximum of #750,000 may be payable based on
the performance of CHS Ltd for the twelve month periods to 31 December 2007 and
31 December 2008. #250,000 will be payable if the audited Gross Margin (defined
as Gross Profit less Overheads, but excluding any additional overheads, charges
or costs specifically and additionally incurred by CHS Ltd at Real Affinity's
request) in respect of the twelve month period to 31 December 2007 is at least
#50,000 and a further #500,000 will be payable if the audited Gross Margin for
the twelve month period to 31 December 2008 is at least #150,000. The price at
which the deferred consideration shares are issued will be the average
mid-market price for the seven dealing days prior to the end of the respective
twelve month period ("the deferred shares issue price").
In addition, where deferred consideration shares are issued in respect of 2007
or 2008, the Company will in either case grant options to the Vendors over such
number of new Ordinary shares as is equivalent to #40,000 at the relevant
deferred shares issue price. These options will not be exercisable for at least
3 years.
Deferred cash consideration of a maximum of #180,000 may be payable. In respect
of the twelve month period to 31 December 2007, a maximum of #60,000 will be
payable if audited Gross Margin of #200,000 is achieved, reducing pro rata such
that no cash consideration will be payable where audited Gross Margin of #50,000
or less is achieved. In respect of the twelve month period to 31 December 2008,
a maximum of #120,000 will be payable if audited Gross Margin of #450,000 is
achieved, reducing pro rata such that no cash consideration will be payable
where audited Gross Margin of #150,000 or less is achieved.
In the year ended 31 August 2006, CHS Ltd's unaudited accounts showed turnover
of #270,393 and net profit after tax of #62,675. A total dividend of #66,330 was
declared for the year. Net assets at the year end were #18,836.
Application has been made for the 45,454,545 new Ordinary Shares to be issued as
initial consideration to be admitted to trading on AIM. The new Ordinary shares
will rank pari passu with the Company's existing ordinary shares and admission
is expected to commence on 11th January 2007. Following admission there will be
3,240,979,774 shares in issue.
5th January 2007
ENQUIRIES
Real Affinity Tel 01274 421 700
Gerard Corcoran, Group Chief Executive
Brent Fitzpatrick, non-executive director
HB Corporate Tel: 020 7510 8600
Edward Hutton
Bankside Consultants Tel: 020 7367 8888
Michael Padley / Daniela Hale
Notes to Editors:
About Real Affinity
Real Affinity provides integrated marketing and communications services, from
brand building and direct marketing to web consultancy for a wide range of blue
chip clients. With offices in London, Bradford, Swindon, Oxford and Milton
Keynes, it has a number of subsidiaries including Navigator, the sports and
leisure business; Holly Benson, the full service marketing communications
agency; Ladders, a direct marketing subsidiary; Onstate, its digital web agency
and Venues Unlimited, the conference placement and event company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQUUUAWGUPMGMC
Real Affinity (LSE:RAF)
Historical Stock Chart
From May 2024 to Jun 2024
Real Affinity (LSE:RAF)
Historical Stock Chart
From Jun 2023 to Jun 2024
