The Boards of Informa PLC and UBM plc have today announced the key financial terms of the proposed combination of Informa with UBM.
- Previous reporting: January 16, 2018 – UBM and Informa announce talks about a possible merger
This statement, issued by the Board of Informa, expands on the earlier joint release to provide further detail on Informa’s rationale for the Proposed Combination.
The Board of Informa sees compelling commercial and strategic rationale for the Proposed Combination, bringing benefits to Customers and Colleagues, while creating significant value for Shareholders, supported by accelerated growth opportunities and significant synergies.
Commenting on today’s announcement, Chief Executive of Informa, Stephen A. Carter, said:
“It is clear that the B2B Market is moving to Operating Scale and Industry Specialisation. The Combined Group will have the reach and market capabilities to take full advantage of these trends.”
“We are today proposing the creation of a B2B Information Services Group, which will be ideally positioned to serve a market demanding ever greater Operating Scale and Industry Specialisation. The Combined Group will have the international reach, operational capabilities and cashflow to pursue the full growth opportunities this creates.”
Key Financial Terms
It is expected that the Proposed Combination would be implemented through a share and cash offer by Informa for the entire share capital of UBM. Under the terms of the Proposed Combination, UBM shareholders would receive:
For each UBM Share:
1.083 Informa Shares; and
163 pence in cash
On these terms, based on (i) the 30-day volume-weighted average share prices as of 15 January 2018 of Informa and UBM and (ii) the closing share prices on 15 January 2018 of Informa and UBM, this represents in both cases a premium of around 30%.
It is expected that the Combined Group will be owned c.65.5% by Informa shareholders and c.34.5% by UBM shareholders. The proposed offer will also include a mix and match facility.
Compelling Strategic and Commercial Rationale
The Combined Group will be well-placed to benefit from the trend in the global B2B Information Services market towards increased Operating Scale and IndustrySpecialisation. The Combined Group will build on the respective strengths of Informa and UBM to meet growing customer demands for Brands and partners with international reach, specialist industry knowledge and an increasingly wide range of B2B services incorporating face-to-face platforms and events, data analytics, targeted marketing services and trusted, reliable intelligence and research.
The industrial logic of a combination of Informa and UBM is well understood. Given current portfolio complementarity, geographic focus and forward growth trajectory, now is the opportune moment to create a Combined Group with the scale and specialist capabilities able to capture the long-term growth potential of this market.
The timing is further supported by the positive benefits of the respective transformation programmes of both Groups, which have led to greater focus and operational efficiency.
The Proposed Combination
The Combined Group will be well-placed to build on the success of Informa’s 2014-2017 Growth Acceleration Plan and UBM’s Events First strategy. It will become the number one B2B Events Group globally and leading Exhibitions business in the key growth markets of China and the US, creating the scale and reach both Informa and UBM have been pursuing. The Combined Group will also own complementary subscription-based B2B Intelligence and specialist B2B Marketing Services businesses. It will also continue to own and operate a leading Scholarly Research business, Taylor & Francis, a core business that is expected to provide revenue growth, attractive margins and strong cashflow to the Combined Group.
Benefits of Operating Scale
· Revenue growth…creates scale growth business within attractive growth markets; near-term incremental revenue opportunities through cross-marketing, internationalisation, digital platforms, sponsorship and supplier commissions and longer-term potential growth acceleration through increased Industry Specialisation;
· Global reach…highly complementary geographic fit provides broader based growth and market opportunities with a significant proportion of revenue from faster growth economies, including leading positions in major markets of the United States, China, Middle East, South America and India;
· Quality of earnings…increased scale and international breadth provides resilience and balance, as well as greater predictability with a high proportion of revenue from forward booked and recurring revenue streams;
· Cashflow strength…both businesses benefit from attractive levels of profitability and cash conversion, leading to consistently strong Free Cash Flow. This provides flexibility and funds for maintaining balance sheet strength, continued investment in growth and progressive shareholder returns;
· B2B Events leadership…scale and leadership in the major Events markets of the United States, China, Middle East, South America and India, and strength in verticals including Health & Nutrition, Life Sciences & Pharma, Real Estate & Construction and Technology;
· Operational excellence…world class talent and extensive management experience focusing on best-in-class operational execution and performance across both the Informa and UBM portfolios;
· Technology innovation…increased operating and financial scale facilitating greater levels of product and platform innovation;
· Operating synergies…scale efficiencies and cost duplication, driving significant combined operating synergies.
Over time, the Proposed Combination will be the catalyst to capture the wider benefits of Specialisation in B2B Information Services, accelerating the shift to a more customer-led operating model built around the strengths of the Combined Group’s positions in key industry verticals and a broad set of powerful B2B capabilities.
Benefits of Industry Specialisation
· Industry strength and depth…international reach and depth in 15 targeted industry verticals, providing subscription-based products, high quality branded confexes, scale exhibitions and trade shows, specialist lead generation and content, all serving targeted networks and communities;
· Customer strength…deeper, more strategic customer relationships across multiple B2B channels and services;
· Marketing Services…growth opportunity in specialist B2B Marketing Services providing targeted lead generation at scale, including specialist B2B data and insight;
· Verticalisation…gradual shift to customer-led, vertically-oriented operating model, becoming a growth-enabler in key industries.
The 2014-2017 Growth Acceleration Plan (“GAP”)
Today’s announcement follows the completion of Informa’s 2014-2017 Growth Acceleration Plan. The plan involved a programme of operational change and investment to deliver sustainable growth and operational capabilities via five key objectives:
1. Build and Buy a scale B2B Events business in the Global Exhibitions Division
2. Repair and return to growth the Business Intelligence Division
3. Simplify, focus and grow the Knowledge & Networking Content Division
4. Build scale and management capability in the US market
5. Invest to build the platforms and capabilities for future scale and growth
GAP was successfully completed in 2017.
In Global Exhibitions, revenue has grown from £160m in 2013 to more than £550m in 2017 through a combination of market-leading underlying growth and a programme of targeted vertical acquisitions, including in Health & Nutrition (Virgo, Penton), Construction & Real Estate (Hanley Wood, Dwell) and Beauty & Aesthetics (China Beauty, FACE).
People and Talent
· Both Informa and UBM are proudly people businesses with the energy, ideas and contribution of colleagues across the world their single most important asset. The Combined Group will be able to draw on the best talent and experience from both companies to lead the business going forward.
· The Combined Group would continue to be headquartered in London, although the international nature and complementary geographic fit of the businesses will mean it will also have major operational centres around the world.
· It is intended on completion of the Proposed Combination that:
· Derek Mapp, Chairman of Informa, would be Chairman of the Combined Group.
· Stephen A. Carter, Chief Executive of Informa, would be Chief Executive of the Combined Group.
· It is also envisaged that the Board of the Combined Group would be comprised of seven Non-Executive Directors from Informa and three from UBM.
· Informa is scheduled to release its 2017 Full Year Results on 28 February.
· Following the end of the financial year and completion of the 2014-2017 Growth Acceleration Plan (“GAP”), Informa can confirm in respect of the 2017 financial year it expects the Group will deliver more than 3% underlying revenue growth. This includes continued strong growth in Global Exhibitions and improved growth in Academic Publishing, Business Intelligence and Knowledge & Networking since the Ten Month Trading Update.
· Informa remains confident about the opportunities in its key markets and believes, post-GAP, it is well placed to pursue them. In the 2018 financial year, this includes targeting underlying revenue growth for the Group of more than 3.5% and sustained underlying revenue growth in all four Divisions.
· Discussions between the parties remain ongoing regarding the other terms and conditions of the Proposed Combination, satisfactory completion of due diligence and final approval by the Boards of Informa and UBM. The parties reserve the right to waive any or all of these pre-conditions.
· Subject to the ongoing discussions, the Boards of Informa and UBM expect to recommend the Proposed Combination to their respective shareholders.
· It is proposed that UBM shareholders would be entitled to receive the final UBM dividend in respect of the year ended 31 December 2017 (the “Final UBM Dividend”). In addition, UBM shareholders would be entitled to receive the Informa final dividend for the financial year ended 31 December 2017 (the “Final Informa Dividend”) if completion of the Proposed Combination occurs prior to the record date for the Final Informa Dividend, or if completion is later, a special dividend equivalent to the amount of the Final Informa Dividend.
· It is also proposed that UBM shareholders would be entitled to (a) receive any ordinary course interim dividend declared by UBM and (b) receive the equivalent amount of any further ordinary interim dividend announced, declared or paid by Informa with a record date falling prior to completion of the Proposed Combination, less the value of any further ordinary interim dividend paid by UBM.
· Informa reserves the right to reduce the terms of the Proposed Combination to take account of the value of any dividend or other distribution which is announced, declared, made or paid by UBM which is in addition to the dividends UBM shareholders are entitled to receive as set out above.
· This announcement does not amount to a firm intention to make an offer under Rule 2.7 of the Code. The full terms and conditions of any offer, if made, and a quantification of the synergies will be set out in a further announcement. There is no certainty that any transaction will occur, even if the pre-conditions are satisfied or waived.
· Informa reserves the right, with the agreement or recommendation of the UBM Board, to (a) make an offer for UBM, at any time on less favourable terms than the Proposed Combination described above; and/or (b) vary the form and/or mix of consideration.
Chief Executive of Informa, Stephen A. Carter, concluded:
“This is the right moment to combine our strengths, enabling us to capture fully the long-term growth opportunities in this attractive market, bringing benefits for customers and colleagues, as well as generating significant value for shareholders.”
- UBM and Informa announce talks about a possible merger Posted on January 16, 2018
- AI Business sold to Informa (Knect365) Posted on December 6, 2017
- Informa acquires Dove Medical Press Posted on September 26, 2017
- Informa acquires Yachting Promotions for £106M Posted on March 2, 2017
- Informa acquires Penton, the US- based Exhibitions and Information Services group, for £1.2bn Posted on September 16, 2016
- Progressive Digital Media Group completes the acquisition of Datamonitor Financial, Datamonitor Consumer, MarketLine and Verdict businesses from Informa Posted on September 1, 2015
- A Fusion Deal: UK Health IT exhibition EHealthLIVE sold to Informa PLC Posted on February 26, 2015
- Informa acquires a stake in Chinese company Baiwen Posted on November 27, 2013
- Informa completes the disposal of its five Corporate Training businesses Posted on October 1, 2013
- Informa disposes of its five corporate training businesses Posted on July 19, 2013
- Stephen Carter to replace Peter Rigby as Informa Group Chief Executive Posted on July 11, 2013
- Informa acquires Zephyr Associates for $62M Posted on October 16, 2012
- UBM acquires THE Aesthetic Show from Medical Insight Posted on November 17, 2017
- UBM acquires Allworld Exhibitions Posted on December 12, 2016
- UBM divests electronics media portfolio Posted on June 3, 2016
- UBM buys Business Journals Inc for $69M Posted on April 22, 2016
- UBM sells PR Newswire to Cision Posted on December 15, 2015
- UBM buys Hospitalar, Latin America’s largest healthcare trade show posted on June 3, 2015
- UBM agrees to acquire Advanstar for $972M posted on October 3, 2014
- Advanstar Global acquires ENK International posted on December 7, 2012
- UBM in advanced talks to acquire Advanstar September 19, 2014
- UBM acquires cruise and maritime media business Seatrade Communications Posted on August 1, 2014
- UBM results for the six months ended 30 June 2014 posted on August 1, 2014
- UBM acquires Expo CIHAC in Mexico Posted on May 12, 2014
- UBM reports a 10 percent rise in full-year profit Posted on February 28, 2014
- Progressive Digital Media Group acquires Pyramid Research from UBM Posted on December 12, 2013
- UBM plc sells Property Week to Metropolis and UBM Channel to The Channel Company Posted on September 27, 2013
- Mash Media acquires International Confex from UBM Live Posted on September 21, 2013
- David Levin to step down as CEO of UBM Posted on September 16, 2013
- UBM report a decline in profits for the first six months Posted on August 5, 2013
- UBM Asia to acquire NOVOMANIA in China Posted on March 7, 2013
- UBM results for the year ended 31 December 2012 Posted on March 1, 2013
- Electra Partners to acquire UBM’s Data Services businesses Posted on February 5, 2013
- UBM acquires outstanding 50% stake of Canada Newswire for £30.1m Posted on November 1, 2012
- UBM acquires 70% stake in Turkish baby product tradeshow EFEM Posted on October 18, 2012
- UBM – results for the six months ended 30 June 2012 Posted on July 30, 2012
- UBM Aviation Routes Limited acquires Airlineroute.net Posted on May 20, 2012
- UBM plc acquires Negocios nos Trilhos, South America’s leading railway industry exhibition Posted on April 16, 2012
- UBM 2011 results Posted onFebruary 28, 2012
- UBM acquires four tradeshows Posted on February 28, 2012
- UBM acquires Renewable Energy India Posted on February 28, 2012
- UBM plc acquires 4G World exhibition and conference Posted on February 7, 2012
- UBM sells its Daltons business Posted on February 7
- Founders of Briefing Media to acquire UBM’s UK agriculture and medical general practitioner portfolios Posted on February 7, 2012
- UBM plc and Roularta Media Group form Belgian medical print journal joint venture business Posted on February 3, 2012
- UBM TechWeb acquires Online Marketing Summit Posted on November 19, 2011
- Intent Media acquires UBM titles for £2.4m Posted on June 27, 2011
- UBM acquires 70% of US catering tradeshow business Catersource for $5 million Posted on June 21, 2011
- UBM plc acquires AMB exhibitions business in South East Asia Posted on May 12, 2011
- UBM Medica sells The Consultant Print Group April 29, 2011
- UBM Q1 results Posted on April 21, 2011
- UBM disposes of French medical print business Posted on March 1, 2011
- UBM disposes of UK licensed trade portfolio Posted on March 1, 2011
- UBM acquires Indian travel tradeshow SATTE Posted on March 1, 2011
- UBM to acquire stake in Famdent, India’s largest dental exhibition and conference business Posted on March 1, 2011
- UBM acquires Publishing Expo tradeshow for £320,000 Posted on November 11, 2010
- UBM acquires Lead in Research for £1.45m Posted on November 2, 2010
- UBM acquires Hors Antenne for up to €9m Posted on October 20, 2010
- UBM acquires OBGYN.net for $0.8 million Posted on October 15, 2010
- UBM to acquire 65% stake in Rotaforte International Trade Fairs & Media Posted on October 14, 2010
- UBM acquires Canon Communications LLC for $287 million Posted on September 16, 2010
- UBM agrees to acquire UM Paper for up to $880,000 Posted on September 16, 2010
- UBM Studios acquires virtual recruitment fairs business Astound Posted on September 1, 2010
- UBM Aviation acquires The Route Development Group Posted on August 13, 2010
- UBM acquires Children-Baby-Maternity Products Expo in China and related assets Posted on August 13, 2010
- PR Newswire acquires CORPORATE360 Posted on June 29, 2010
- UBM to acquire majority stake in Navalshore Posted on June 15, 2010
- UBM Global Trade acquires selected Centradex assets Posted on May 6, 2010
- UBM acquires web-based marketing business SharedVue Posted on April 21, 2010
- UBM TechWeb acquires Game Advertising Online for up to $8million Posted on February 26, 2010