CentralNic Group PLC Acquisition of TPP Wholesale (4840Z)
20 May 2019 - 4:00PM
UK Regulatory
TIDMCNIC
RNS Number : 4840Z
CentralNic Group PLC
20 May 2019
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
20 May 2019
CentralNic Group plc
("CentralNic" or "the Company" or "the Group")
Acquisition of TPP Wholesale
CentralNic Group plc to acquire the leading Australian and New
Zealand domain name and hosting reseller business TPP Wholesale for
$24m AUD
CentralNic Group PLC (AIM: CNIC), which sells subscription
internet services to businesses globally, announces it has entered
into a conditional agreement to acquire the Sydney-based business
TPP Wholesale, the leading platform for resellers of domain names
and hosting in Australasia for a headline consideration of $24m AUD
(the 'Acquisition').
About TPP Wholesale
TTP Wholesale is a carve out of certain trade and assets from
ARQ Group Limited (ASX: ARQ) ("ARQ"), a company listed on the
Australian Securities Exchange. The acquisition is the next step in
CentralNic's strategy as a rapidly growing global consolidator in
the recurring revenue domain name industry.
TPP Wholesale is Australasia's leading domain name and hosting
reseller platform business with around 14,000 reseller customers
and 840,000 domains under management, including 19% of all .com.au
registrations.
TPP Wholesale will be an extension in Australia and New Zealand
of CentralNic's largest business unit, which supplies domain names
to resellers globally including most of the world's top ten domain
name retailers by volume. CentralNic will provide TPP Wholesale
customers with continuity of service, while also upgrading the
service with new products.
The TPP Wholesale acquisition will also mark the first steps in
CentralNic becoming a reseller of Amazon Web Services and Microsoft
Office 365.
Information on the Acquisition
The total consideration is $24m AUD including taxes, to be paid
in cash and by assuming certain liabilities of c. $1.6m AUD from
the ARQ at completion. ARQ has not historically reported TPP
Wholesale results as a stand-alone segment, however the Company has
determined that stand-alone revenues and Adjusted EBITDA for the
trade and assets to be acquired for the financial year ended 31
December 2018 were $17.0m AUD and $3.9m AUD respectively on an
unaudited basis. Given the acquisition is a carve out from a listed
entity, CentralNic expect to incur a number of one-off integration
costs of approximately $1.8m AUD, of which $0.7m AUD are expected
to arise in CentralNic's current financial year ending 31 December
2019.
The acquisition is conditional, inter alia, on a financing
condition. CentralNic is in advanced talks with debt providers and
the condition is expected to be satisfied towards the end of June.
Further details are to be announced soon.
The CentralNic Board expect the acquisition to be immediately
earnings enhancing and that it will result in double digit earnings
accretion for the financial year to 31 December 2020. The Board
also believes there is significant scope for cost synergies
following successful completion of integration into CentralNic.
This transaction is CentralNic's third acquisition in twelve
months, continuing its industry consolidation strategy and
expansion into key markets globally.
Ben Crawford, CEO of CentralNic, said: "We are delighted to
become the leading supplier to domain name and hosting resellers in
Australasia through this highly earnings accretive acquisition. We
look forward to bringing the benefit of our global resources to our
thousands of new Australian and New Zealand domain name reseller
customers. The timing of this deal is propitious as it allows
CentralNic to participate fully in the proposed launch of the new
.au domain extension."
For further information:
CentralNic Group Plc
Ben Crawford, Chief Executive Officer
Don Baladasan, Group Managing Director
Michael Riedl, Chief Financial Officer +44 (0) 203 388 0600
Zeus Capital Limited (NOMAD and
Joint Broker)
Nick Cowles / Jamie Peel (Corporate
Finance)
John Goold / Rupert Woolfenden +44 (0) 161 831 1512
(Institutional Sales) +44 (0) 203 829 5000
Stifel (Joint Broker)
Fred Walsh / Neil Shah / Alex Price
/ Rajpal Padam +44 (0)20 7710 7600
Newgate Communications (for Media) +44 (0) 203 757 6880
Bob Huxford centralnic@newgatecomms.com
Tom Carnegie
Robin Tozer
About CentralNic Group plc
CentralNic (AIM: CNIC) is a London-based AIM-listed company
which drives the growth of the global digital economy by developing
and managing software platforms allowing businesses globally to buy
subscriptions to domain names, used for their own websites and
email, as well as for protecting their brands online. Its core
growth strategy is identifying and acquiring cash-generative
businesses in its industry with annuity revenue streams and
exposure to growth markets and migrating them onto the CentralNic
software and operating platforms.
CentralNic operates globally with customers in almost every
country in the world. It earns recurring revenues from the
worldwide sales of internet domain names and other services on an
annual subscription basis.
For more information please visit: www.centralnicgroup.com
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END
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