1st August 2005
Cello acquires RS Consulting
Cello Group plc (‘Cello’), the marketing services group which listed on AIM in November 2004, has acquired RS Consulting (Holdings) Limited (‘RS’), a leading market research and business consultancy, for a total maximum consideration of up to £4.75m million in cash, loan notes and new ordinary shares.
RS, formed in 1984 by Bryan Atkin & John Leston, is a predominantly business to business market research agency. It works with a range of leading international and domestic clients including HP, Xerox, Sony, FedEx, Department of Work & Pensions, AXA, Yell, RBS, AON and BUPA. RS will join Cello’s market research platform.
The initial consideration consists of £2.4 million, of which £1.2 million is in cash and the balance satisfied by the issue of 987,655 new ordinary shares at completion. In addition, there is a maximum deferred consideration of up to £2.35 million dependent on the financial performance of the business for the period to 31 December 2009. The deferred consideration is payable in a mixture of loan notes and new ordinary shares at Cello’s discretion. The maximum share element will be 75% of the deferred consideration.
For the year to 30 September 2004, RS had a turnover of £9.6 million, gross profit of £3.8 million and profit before tax of £0.1 million and will deliver net assets of approximately £0.5 million at completion.
Application will be made to the London Stock Exchange for the new shares to be admitted to AIM and it is expected that admission will take place by 5 August 2005.
Kevin Steeds, Cello Chairman, said:
‘We are delighted to welcome RS to the Group. They are a long established and high quality business that will complement our specialist healthcare and consumer research and planning consultancies. The addition of RS further reinforces our focus on the high value added business advisory and consulting end of the market.’