Acquisition of Solstice Consulting LLC

RNS Number : 5971H

St. Ives PLC

17 March 2015

 

17 March 2015                                   

St Ives plc

Acquisition of Solstice Consulting LLC

St Ives plc ("St Ives" or the "Group"), the international marketing services group, announces that it has acquired Solstice Consulting LLC ("Solstice"), a Chicago-based digital consultancy specialising in mobile-first digital product design and engineering services.

Established in 2001 and trading under the name Solstice Mobile, the business employs approximately 200 staff across three offices in Chicago, New York and Buenos Aires. The company has a strong client base across Fortune 1000 businesses in the US, with particular strength in the financial services, manufacturing and distribution sectors.

The acquisition represents a continuation of St Ives' strategy to further enhance its wider digital expertise and provides the Group with deeper mobile, customer engagement and loyalty capabilities. It also supports St Ives' target of increasing its international footprint and signals the Group's intent to be seen as a credible contender to the leading digital agency groups and consultancies, both in the UK and overseas.

In the financial year ended 31 December 2014, Solstice generated adjusted EBITDA* of £2.7 million on revenue of £16.5 million; gross assets were £5.1 million (*before items of a one-off nature).

St Ives has agreed to acquire Solstice, on a cash and debt free basis, for £24.7 million, to be satisfied by approximately £20.0 million in cash and approximately 2.6 million St Ives shares. Further consideration of up to £25.3 million may be payable (to be satisfied 80% in cash and 20% in shares) dependent on incremental profit performance for the years ending 31 December 2015, 2016 and 2017.

The acquisition will be earnings enhancing, on an underlying basis, in the current financial year.

Solstice will operate as a subsidiary of St Ives and will continue to be managed from its current location by its existing management team, which includes J Schwan, the vendor.

Matt Armitage, Chief Executive of St Ives, commented:"This acquisition further strengthens St Ives' reputation and capabilities in digital, and significantly extends these into mobile. Strategically, the deal supports the growth of the Group's marketing services division, while expanding our presence and capabilities in the Americas."

Commenting on the acquisition, J Schwan, CEO of Solstice Mobile, said: "We are very excited to have found the perfect home for Solstice. As mobile continues to affirm its role as consumers' and employees' primary digital channel, we are thrilled to have a platform to expand our services on a global level. Most importantly, St Ives shares our core values of using company culture as a competitive advantage."

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For further information please contact:

St Ives plc                                                      020 7928 8844

Matt Armitage, Chief Executive

Brad Gray, Chief Financial Officer

MHP Communications                                 020 3128 8100

John Olsen / Giles Robinson / Gina Bell

About St Ives Group

St Ives is an international marketing services group, made up of a number of successful and dynamic businesses serving leading brands internationally, with offices in the UK, North America, China and Singapore.

We operate not as a single entity but as a group of market leading businesses, each with its own unique value proposition, offering complementary services and collaborating closely with each other wherever this adds value to clients. We work with a large number of leading, international consumer-facing brands across all major sectors - including retail & FMCG, healthcare & pharma, financial services, media, technology, automotive and charity - helping them determine strategic direction, and designing and delivering world-class solutions to match their specific requirements.

Our industry leading Strategic Marketing businesses have strong capabilities across three specialist high growth areas: data, digital and consulting.

Our Marketing Activation businesses, which deliver marketing communications through a combination of print and in-store marketing services, complement our Strategic Marketing offering and collaborate with them where this adds value to clients.

The Group's strategy for further growth is centred around three key priorities:

o  organic growth through collaboration and investment in our existing brands;

o  internationalisation, often client-led, into large and high growth markets; combined with

o  further acquisitions of complementary, ambitious and growing Strategic Marketing businesses that share our common attributes and ethos.

Our longstanding Books business, which is the UK market leader, represents another valuable source of profit and cash generation as the Group continues to expand.

 

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