Encore Digital Media acquired by Next Fifteen in £687k deal
Next Fifteen Communications Group, a digital communications group, has acquired a 75% stake in Encore Digital Media, a programmatic advertising technology business based in London.
Encore was founded in 2013 by Dan Shaw, and Guy O’Brien, who will remain in the business following the acquisition and the team includes five other staff providing data and programmatic media services to its clients, primarily in the B2B space.
The initial cash consideration is £687,000, with a further payment to be paid as a ‘top-up payment’ in July 2015 dependent on Encore’s annual profits to 31 May 2015.
Next Fifteen has more than 1,000 employees working across 51 offices in 18 countries and it also owns four independent public relations brands: Text 100 and The OutCast Agency focus on technology, business and corporate communications; Lexis and M Booth both specialise in consumer communications
The acquisition is expected to be earnings enhancing for the Group at each stage. The deferred consideration may be satisfied by cash or up to 25% in Next 15 shares, at the option of Next 15.
The remaining 25% stake in Encore will be acquired by Next 15 in 2020, with the consideration based on Encore’s annual profits for the financial years ending 31 January 2019 and 31 January 2020 with the multiple again being dependent on revenue growth and profit margin.
For the year ended 31 May 2014 Encore had revenues of £429k, pre-tax profit of £153k and net assets of £74k.
Tim Dyson, CEO of Next 15 commented: “The Encore team has rapidly established a highly distinctive programmatic media and data business, which will be a great fit in the Next 15 group. This acquisition is another step in our strategy to build broader, data-driven marketing communications capabilities for our group.”
Guy O’Brien, Encore partner, said: “We see this as a great opportunity to take Encore to the next level as part of a forward thinking group. We aim to build on the early success we have had with our approach to B2B in the digital world within the Next 15 group.”