Chime Communications has acquired The Icon Group, an experiential marketing business, based in Sidcup in Kent. Icon brings sponsors’ brands to life at stadia and major sporting events around the world, usually on the basis of multi-year contracts. Customers include major sporting federations such as UEFA where Icon has assisted in the physical branding of the UEFA Champions League for the past 7 years. Other customers for whom Icon has worked or is currently working include FIFA; the Ryder Cup; the Boat Race; Abu Dhabi Motor Sports; and LTA Wimbledon.
Chime is to pay an initial consideration of £11 million of which £7.15 million will be through the Vendor Placing and the balance through the issue of the Consideration Shares. The Consideration Shares are subject to orderly marketing restrictions such that no shares can be sold for 12 months following the date of issue and only 50% may be sold in the following 12 months. In addition, two further tranches of deferred consideration may become payable. The first tranche will be calculated as 4.75 times average 2011 and 2012 earnings before interest and tax less the initial consideration and will be payable in 2013. The second tranche will be calculated as 4.75 times average 2013 and 2014 EBIT less both the initial consideration and the first tranche and will be payable in 2015. In both cases, the deferred consideration will be satisfied 50% in loan notes and 50% through the issue of shares in Chime (although Chime retains the right to pay the share consideration through the issue of loan notes). A further payment of £0.6 million will be made to Maidstone shareholders representing surplus cash in Maidstone. Following completion a sum of £0.6 million will be immediately paid to Chime as a dividend. In the event that the Placing does not become unconditional Chime has the right (but not the obligation) to complete the acquisition of Icon and settle in cash that part of the initial consideration which would have been satisfied through the Vendor Placing.
For the year ended 31 December 2010, Icon reported revenue of £18.8 million and EBIT of £1.9 million after one-off items totalling £0.2 million. At 31 December 2010 the gross assets of Icon were £8.6 million. On 7 February 2011 Icon acquired for cash consideration of £1 million the trade and assets of Stanford Logistical Support Limited (‘SLS’), a company which focuses on the events industry for the delivery and implementation of city dressing and event branding. For the year ended 30 November 2010 SLS had revenue of £2.1 million and net profit of £0.2 million.
Chime sees significant growth opportunities for Icon resulting from the Olympic Games in London in 2012 and in Rio in 2016 and in utilising the contacts and relationships with major world sporting federations that Icon will bring to the Sports Marketing division. The experiential marketing activity is also a business which other Chime companies will market to their clients.
UK, London & Sidcup, Kent