Be Heard Group Plc, a digital marketing services group, is to acquire a 75% stake in Freemavens Limited, a marketing analytics and innovation consultancy specialising in the use of big data, for a total consideration of around £1.7m.
For the financial year ended 31 December 2016 Freemavens delivered £1.72 million gross revenue and £0.41m adjusted EBITDA.
Be Heard will acquire 75% of Freemavens’ equity for £0.84m, that is £0.48m in cash and the issue of 9,303,766 new Be Heard shares. As part of the Acquisition, Be Heard will also repay Freemavens’ existing debt obligations of around £0.87m, due principally to the exiting majority shareholder Let‘s Go Crazy Limited, taking the total consideration to approximately £1.7m.
The remaining 25% of Freemavens’ equity is being retained by its two founders, who are continuing with the business, and will be subject to a put and call option exercisable after four years, payable 50% in cash and 50% in new Be Heard shares, at a valuation of the lower of 2x historic revenue and 8x historic EBITDA. The maximum total consideration payable is £7.7m.
Founded in 2012 by Andrej Moyseowicz and Christopher Palengat, Freemavens is an analytics and innovation consultancy which aims to solve clients’ business challenges and develop insights and actionable ideas using big data. The agency, with its 20-strong team, has developed several in-house data analytics tools and methodologies and has clients including Unilever, Barclays, Channel 4 and RNLI.
Peter Scott, Executive Chairman of Be Heard said: “The Freemavens team will give Be Heard industry leading analytics capability, and once bedded into our Group will augment and enhance the work we do for clients. Intelligent use of data underpins all decision making; our intention is to develop the analytics capability at Be Heard as a central function and resource for our clients. Bringing the exceptional Freemavens team into the fold is, I believe, a bold first step.”
Completion of the Acquisition is conditional upon completion of a cash placing to raise gross proceeds of £2.1m.