LONDON (Alliance News) - Brand and product development specialists LiteBulb Group Limited Tuesday said it has entered into a conditional share purchase agreement to acquire Meld Group Limited for an initial consideration of GBP2 million in cash and 347.6 million in shares. The company also plans a share placing to fund part of the deal.
Meld has predominantly focused on developing products for the books, gifts and games markets.
Through a conditional placing of up to 428.6 million shares, Meld intends to raise up to GBP3.0 million which will be used for working capital purposes with the remainder used to partly fund the acquisition.
In addition to the consideration shares issued to the sellers at completion, up to 347.6 million further shares - each an earn out share - may be issued to the sellers following the conclusion of the earn out period.
The sellers, including Meld Managing Director Nick Ponting will be entitled to receive earn out shares if the aggregate earnings before interest, taxation, depreciation and amortisation of Meld and its subsidiaries, Meld Group, exceeds GBP683,000 during the period commencing January 1, 2014 and ending on December 31, 2014.
The 347.6 million consideration shares will, if issued, equate to a 15.6% stake in the firm.
Litebulb said Meld has a strong financial performance record with revenue of GBP8 million for the year ended May 31, 2012
The completion of the acquisition and the placing is conditional on, amongst other things, shareholder approval.
The stock was trading at 0.770 pence Tuesday morning, down 0.055 pence or 6.7%.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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