SEC S.p.A Acquisition of majority shareholding in Bellenden (6229J)
13 September 2016 - 4:00PM
UK Regulatory
TIDMSECG
RNS Number : 6229J
SEC S.p.A
13 September 2016
13 September 2016
SEC S.p.A.
Acquisition of majority shareholding in Bellenden Limited
SEC S.p.A. ("SEC" or the "Company"), the largest independent
advocacy, public relations and integrated communications agency in
the Italian market, has acquired a majority shareholding in
Bellenden Limited (trading as Newington) ("Newington") (the
"Acquisition") in line with its stated acquisition strategy and
specifically referred to in the Admission document dated 20 July
2016.
The initial consideration, for 60% of the issued share capital
of Newington, comprises a completion cash payment of GBP 1,223,000
and a further cash payment of GBP 174,877.
Under the terms of the Acquisition, SEC will make two further
cash payments of deferred consideration through an earn out
mechanism linked to Newington's EBITDA over the three financial
years ending on 31 March 2018. The consideration payable under the
earn out will be calculated using an EBITDA multiple based on
Newington's reported EBITDA (subject to certain adjustments). The
adjusted EBITDA and amounts payable by SEC under the earn out will
be agreed between the parties or determined by independent
accountants. The amount payable under the earn out mechanism has
been capped at GBP 3,871,000. The directors of the Company
anticipate that the Acquisition will be earnings enhancing based on
the current share price of the Company. This statement regarding
earnings enhancement is not a profit forecast and should not be
interpreted to mean that the Company's earnings per share will
necessarily match or exceed the historic earnings of the
Company.
Newington has a strong track record in public and corporate
affairs at a local, national and European level. The award-winning
agency has, in a decade, grown from two consultants in South London
to more than 45 consultants operating from its new London HQ and
from offices in Scotland, the North West, the Midlands and the East
of England. Its specialist consultants work in a range of sectors
including education, energy and environment, financial services,
health, housing, justice and legal, as well as property development
and transport.
In the year ended 31 March 2016 Newington's turnover was GBP
3,329,614 (unaudited) and Newington made a profit before tax of GBP
837,349 (unaudited).
Existing management, who will hold the minority shareholding,
will continue to run the business, retaining the values, culture
and ethos for which Newington is known to date. This is in line
with the SEC strategy which is successfully building a partnership
of independently run consultancies who are encouraged to retain
what it is that has set them apart from the competition rather than
a network of agencies who lose their identity in the process of
being taken over by a larger multinational.
As part of the SEC Group, Newington will have the necessary
scale to continue to build its business at a local, regional,
national, and international level. SEC will base its international
headquarters at Newington's office in London from which it will
expand its reach in Europe in addition to expansion into the
Americas and Asia.
A shareholders' agreement between SEC and the minority
shareholders in Newington regulates the operation and management of
Newington following completion. The terms of that agreement entitle
the minority shareholders to exchange their shares in Newington for
ordinary shares in SEC at any time. The number of ordinary shares
in SEC to be issued will be determined by reference to the
aggregate market value of the retained shares in Newington (agreed
by the parties or determined by independent valuers) which are
being exchanged divided by the relevant value of an ordinary share
in SEC.
For these purposes the relevant value of an ordinary share in
SEC will be the average of the middle market quotations for the
existing issued ordinary shares of SEC as shown in the Official
List on the last Business Day in each of the four weeks ended on
the date immediately prior to the date of allotment of the new
ordinary shares in SEC. Any ordinary shares issued to the minority
shareholders will be subject to customary lock-in arrangements for
12 months and orderly marketing arrangements for a further period
of 12 months.
The minority shareholders have, subject to certain conditions,
the right to require SEC to acquire up to 25% of their retained
shares in Newington in each financial year following the fifth
anniversary of completion. The consideration will be agreed between
the parties or determined by independent valuers. 50% of the
consideration will be satisfied in cash and 50% will be satisfied
by the allotment and issue of new ordinary shares in SEC.
No voluntary transfers of shares in Bellenden to a third party
can be made prior to 31 March 2018.
Mark Glover and Phil Briscoe, directors of Newington, will
retain their roles leading Newington, and at the same time Mark
Glover and Phil Briscoe will be part of the management committee of
the SEC Group, the entity whose members are all the managing
directors of the SEC companies. The committee is chaired by Tom
Parker, the managing director of Cambre, the agency based in
Brussels focused on advocacy and public affairs around the European
Institutions.
For more information:
SEC S.p.A. Telephone: +39 335 6008858
Fiorenzo Tagliabue (CEO)
WH Ireland Telephone: +44 207 220 1666
Paul Shackleton
Katy Mitchell
Nick Prowting
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulation (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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