Press Release: Next 15, the digital communications group, is pleased to announce the acquisition of the entire issued share capital of Velocity Partners Limited (“Velocity”), a B2B digital agency with a focus on technology clients. Velocity was founded by Doug Kessler and Stan Woods in 2000, who will remain in the business following its acquisition. Clients include multi-national technology groups, such as Sprint, Xerox and Informatica. Velocity is based in the UK, however, 70% of its revenues came from US-based clients in financial year ended 30 April 2017.
The initial consideration for the acquisition is approximately £5.9 million, of which approximately £4.9 million is to be satisfied in cash with the balance to be satisfied by the issue to the vendors of 251,966 new ordinary shares in Next 15. Further consideration may become payable based on the average profits of Velocity for the years ending 31 April 2018, 31 January 2019, 31 January 2020, 31 January 2021 and 31 January 2022. Any deferred consideration that becomes payable may be satisfied by cash or up to 25 per cent in new ordinary shares, at the option of Next 15. The acquisition is expected to be earnings-enhancing for the Group in the current financial year. For the year ended 30 April 2017, Velocity reported net revenues of £5.2 million, adjusted profit before tax of £1.35 million and net assets of £2.1 million. Velocity is to be acquired debt-free.
Tim Dyson, CEO of Next 15, commented: “Data-driven content marketing is the fastest growing part of the marketing mix right now. This is a key area of investment for us going forward. Velocity has built an impressive business with a strong B2B focus that means it will placed to achieve its ambitions in the US and UK markets. At its core is a strong management team that shares our vision and values. We are very excited to work with them to help them achieve their plans.”
Stan Woods, founder of Velocity, said: “Velocity has always been fiercely independent. But as soon as we met the team at Next 15, we could see that this was the right home for us. We’re thrilled to be a part of such a strong group.”
Application has been made to the London Stock Exchange for the new ordinary shares to be admitted to AIM and it is expected that admission will take place on 13 July 2017. Following the issue and allotment of the new ordinary shares, the Company will have 73,868,144 ordinary shares in issue. No ordinary shares are held in treasury.