15th December 2004
Cello acquires Navigator Responsive Advertising
Cello Group plc (‘Cello’), the newly incorporated marketing services Group which listed on AIM in November, has acquired Navigator Responsive Advertising Limited (‘Navigator’), a leading direct marketing agency based in Edinburgh, for a total maximum consideration of £4.6 million in cash, loan notes and new ordinary shares.
Navigator will be incorporated into Target, the Cheltenham-based direct and database marketing consultancy, which is one of Cello’s three platform operations.
The initial consideration consists of £3.6 million, of which £1.95 million is in cash and loan notes and £1.65 million in new ordinary shares at completion. In addition, there is a maximum deferred consideration of up to £1 million dependent on the financial performance of Navigator for the three year period to 31 December 2007. 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.
Navigator achieved audited profits before tax of £408,563 on turnover of £5.25 million for the year ended 31 December 2003. Navigator will deliver net assets of approximately £500,000 at completion, including cash of approximately £900,000.
Mark Scott, Cello Group Chief Executive, said:
‘Navigator marries Target Direct’s existing strength in direct marketing for charities and the grey market with its equal strength in commercial direct marketing. The combination of the two operations significantly strengthens Cello’s capabilities in the direct marketing sector.’