WPP invests in VR/AR company Within Unlimited in the US

wppWPP has made a strategic investment in Within Unlimited, Inc., a US-based virtual reality/augmented reality entertainment and technology company

Within creates and produces virtual reality content and also curates content from third parties, which it distributes through the Within app.

Partners and content collaborators include Apple, The New York Times, NBC Universal, Vice, 21st Century Fox, and Alphabet Inc. Within employs over 35 people and is based in Los Angeles with an office in San Francisco. It was founded in 2014. Within is led by film maker and music video director Chris Milk and technologist Aaron Koblin.

UK, London & USA, Los Angeles, CA

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Blackstone Acquires Clarion Events

ClarionPrivate equity firm Blackstone has acquired Clarion Events from Providence Equity Partners.

The terms of the deal were not disclosed, but it is being reported that Blackstone pre-empted the second round of an auction for Clarion by submitting a £600 million bid to Providence. Rival bidders included Cinven and Xio, the Chinese investment company.

Founded in 1947, headquartered in London and with almost 1000 employees in 13 offices worldwide, Clarion operates over 180 events and exhibitions in more than 50 countries globally across a range of vertical markets, including Retail & Home, Gaming, Defence and Security, Technology and Energy. Clarion’s best known events include The Olympia Horse Show, House & Garden Show and the Conde Nast Traveller Luxury Fair.

Lionel Assant, Head of European Private Equity at Blackstone, said: “We are delighted to invest in Clarion and back Chairman Simon Kimble and CEO Russell Wilcox in the company’s next chapter.  Clarion’s leading position in its markets combined with its strong management team will enable the company to continue growing both organically and through M&A.  Blackstone has a significant track record of investing in media businesses as well as buy and build platforms.  We look forward to working together with management to capitalise on its success.”

Providence, which acquired Clarion in 2015 for around £200 million, has an option to reinvest a portion of its proceeds from the sale into Clarion.

Russell Wilcox, CEO of Clarion Events, added: “We are extremely excited about our new partnership with Blackstone and see a great future going forward.  The management team has enjoyed an immensely productive and successful relationship with Providence, who have been tremendous partners over the last two years.  We have been impressed with Blackstone’s ambition and approach.  With their support and strategic leadership, we will be looking to expand our global platform even further, both through consistent organic growth and the successful integration of acquisitions into the portfolio.”

Further reporting

UK, London

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Sizmek to Acquire Rocket Fuel for $125.5M

SismekSizmek, an advertising technology company owned by PE firm Vector Capital, is to acquire Rocket Fuel a technology company that offers a Predictive Marketing Platform designed to help marketers & their agencies connect with consumers through digital media, for $125.5 million, or $2.60 per share in cash, valuing Rocket Fuel at approximately $145 million. Rocket Fuel trades on the NASDAQ Global Select Market under the ticker symbol “FUEL.

“The acquisition of Rocket Fuel brings omni-channel creativity and AI-enabled decisioning together under one roof, providing our clients with a self-service predictive marketing platform that optimizes campaigns across the entire media plan,” said Dr. Mark Grether, Executive Chairman of Sizmek.

Collectively, Sizmek and Rocket Fuel service more than 20,000 advertisers and 3,600 agencies to global audiences in over 70 countries.

Rocket Fuel Inc revenues fell 1.16% in FY 2016 compared to FY 2015 to 456.26m. It made net losses of $66 million, compared to a loss of $211 million in 2015. Rocket Fuel’s net loss, adjusted for depreciation and amortisation, is expected to be between $4 million and $3 million in the second quarter of this year.

USA, New York, NY

Taptica Acquires Majority Holding in Adinnovation

Taptica, a global end-to-end mobile advertising platform for advertising agencies and brands, has acquired a majority shareholding in Adinnovation Inc., a Japanese mobile advertising agency, for up to $5.7 million.

Taptica is paying up to $5.7m for 57% of the issued share capital of ADI with approximately three-quarters payable immediately on closing and the remainder after 12 months based on ADI meeting certain targets. In addition, the Company has a call option to purchase the remaining 43% of the issued share capital of ADI for a price of 8x net profit and for a period of six months commencing three years after closing. Thereafter, ADI has a put option for a period of three months to sell at a price of 7x net profit.

Hagai Tal, Chief Executive Officer of Taptica, said: “We are delighted to welcome Adinnovation into the Taptica family. The two companies have been working closely together over the past year, generating revenues and profits together. The acquisition is expected to be accretive and earnings enhancing from day one and we also expect to benefit from a number of strategic synergies and mitigate the costs and risks we would have incurred to penetrate a market such as Japan organically. As a result, the Directors believe this transaction will be a key milestone in the continued international expansion of Taptica.”

Israel, Tel Aviv & USA, San Francisco, CA & Japan, Tokyo

Energy Services Group acquires Utiligroup

ESG logoEnergy Services Group (ESG), the retail energy industry’s provider of SaaS solutions including transaction management (EDI), billing and CIS, wholesale energy services, and sales and pricing, supported by private equity firm Accel-KKR, has acquired UK-based Utiligroup from NorthEdge Capital. Founded in 1997, Utiligroup is a provider of Software-as-a-Service (SaaS) solutions to the utilities and energy industries. The terms of the deal were not disclosed.

NorthEdge initially backed Utiligroup in a £16.1 million management buyout from owners Bglobal (now part of Energy Assets Group) in June 2014. Story Link

Global had acquired Utiligroup in 2010 for a reported maximum consideration of up to £12.8 million. Story Link

UtiligroupThe sale to ESG is the fifth exit from NorthEdge’s maiden £225m Fund I and has generated a gross 5.7x return on investment. NorthEdge is reinvesting alongside
Accel-KKR as part of the new deal.

“ESG continues to build on our strategy of providing best-in-class technology solutions and services to energy resellers and empowering energy choice around the world,” said CEO Phil Galati. “We are incredibly excited about the opportunity to grow our market presence and strengthen our product offerings through the partnership with Utiligroup.”

According to Matthew Hirst, CEO at Utiligroup, “We have built a leadership position in the UK market by consistently innovating, using our deep industry expertise to help our customers grow and evolve with the market.” “We look forward to this next chapter, bringing the best of ESG and Utiligroup to our customers across the globe.”

The UK entity will continue operations as Utiligroup, and Matthew Hirst will remain as CEO of the UK business, reporting to Phil Galati, ESG CEO.  Matthew will also join the board of directors of ESG.

The acquisition of Utiligroup by ESG follows the acquisition of Latitude Technologies in November 2016.

USA, Norwell, MA and UK, Chorley, UK

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Euromoney acquires RISI, a leading price reporting agency, for $125 million

Euromoney PLCEuromoney Institutional Investor is to acquire RISI, the price reporting agency for the global forest products market, for $125 million in cash.

Founded in 1985, RISI has been part of AXIO Group, an Epiris Managers’ business, since 2013. RISI is headquartered in USA, Bedford, Massachusetts, and employs 150 people across the United States, China, Belgium, Finland and Brazil.

risiIts product suite consists of pricing data, mill intelligence and analytics as well as news, research and conferences covering the pulp, packaging, wood products, wood fibre and saw logs markets. Its price indices are critical to the daily business operations and trading activities of major paper and board, packaging and other forest-product companies. 

 RISI’s products are embedded in the workflows of its customers who use RISI’s information to price physical transactions and inform their strategic decisions. Many of RISI’s 2200 price series are used as the main settlement mechanism in industry contracts. 

In calendar year 2016 RISI’s unaudited revenues were $29.6 million and its unaudited EBITDA was $7.7 million. RISI’s revenues are derived predominantly from selling subscription products and have high revenue renewal rates. RISI’s unaudited gross assets at December 31, 2016 were $29.8 million.  

On completion, Euromoney will pay $125 million in cash for RISI, funded from its existing revolving credit facility.  Completion is subject to Hart-Scott-Rodino approval in the United States, which is expected to take approximately four weeks. The acquisition is expected to be earnings-enhancing for Euromoney in its current financial year.

RISI will be managed as part of a new Price Reporting Division, alongside Metal Bulletin Group (Metal Bulletin, American Metal Market and Industrial Minerals), and will report into Raju Daswani, CEO of Metal Bulletin Group and head of the new Price Reporting Division.

Andrew Rashbass, CEO of Euromoney, said: “The acquisition of RISI is another important step in Euromoney’s strategy of building a portfolio of leading price reporting agencies in growing international markets. RISI is a very high-quality business which Euromoney is perfectly placed to grow further. We look forward to working with RISI management and employees around the world to offer the company’s customers products of the highest value.”

In its recent strategy update, Euromoney highlighted price discovery as a key investment theme. The acquisition of RISI follows the acquisition in August last year of FastMarkets, a provider of real-time metals market pricing information.

UK, London & USA, Bedford, MA

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Informa acquires Yachting Promotions for £106M

flibsInforma is to acquire Yachting Promotions Inc. (“YPI”) from Active Interest Media, a privately-owned specialist US media group backed by PE firm Wind Point Partners. The YPI portfolio includes the Fort Lauderdale International Boat Show, the largest in the world, plus Yachts Miami Beach, Palm Beach International Boat Show, Suncoast Boat Show and the St Petersburg Power and Sailboat Show.

Information will pay a cash consideration of $133m (£106m), including $5m which is subject to the business meeting performance and operating targets. Based on its results in the 12 months ended 31 December 2016, this represents a trailing acquisition multiple of 11.5 times EBITDA. The business also brings with it around $40m of net operating losses that are deductible for US tax purposes over a number of years, equating to a net present value of $33.9m. The inclusion of these tax assets implies a multiple of 8.6 times EBITDA.

Stephen A. Carter, Informa Group Chief Executive, said: “Following three years of private discussions, we are delighted to bring YPI into the Group. It will deepen our leadership in the growing international yachting and boating sector, with its attractive exhibitions complementing our existing ownership of the Monaco Yacht Show.”

On completion, the addition of YPI will make Informa’s Global Exhibitions Division the largest contributor to Group revenues and profit, with annual sales of more than £500m. The Division operates a portfolio of about 200 exhibition brands. 

The acquisition further increases Informa’s scale in the US, where the Group has been buying and building a position over recent years through a combination of organic investment and a series of targeted acquisitions in verticals including Construction & Real Estate (Hanley Wood Exhibitions, WWETT), Natural Products (Virgo, Penton), Agriculture (Penton), Life Sciences (FIME) and Pop Culture (Orlando MegaCon, Dallas Comicon). Following the addition of YPI, on a pro-forma basis the US is expected to represent more than 50% of Group revenues and also over half of the Global Exhibitions Division.

The consideration will be funded through existing debt facilities. It is anticipated that the Group’s net debt to EBITDA ratio will be around 2.6 times immediately following completion, falling within the Group’s target range of 2.0 times to 2.5 times by the end of 2017. Completion is expected by early March. 

Note: On 6 March, Informa will announce full-year results for the 12-month period ending 31 December 2016.

UK, London & USA, El Segundo, CA

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