RE: Intellego Holdings (IHP)3 May 2011 11:30
[IHP]
The Board of Intellego, the AIM traded regulatory and compliance focused, digital learning business, is delighted to announce it has acquired PIXELearning Limited ('PIXEL'), a gamification, or serious games and immersive learning simulations company from Milamber Investments Limited.
'Gamification', the process of applying serious gaming techniques to the workplace, is set to become a mainstream approach in large organisations, according to analyst firm Gartner as more than 70% of the Global 2,000 will use 'gamification' or serious games for at least one aspect of their organisation by 2014.
PIXEL established in 2003, has developed and owns proprietary technology called 'Learning Beans' which is used in-house to rapidly create 'rich' engaging and effective immersive learning simulations.
Recently, PIXEL has developed a library of 'Off the Shelf' products such as The Business Game, The Finance Game, The Entrepreneurship Game and the internationally acclaimed Diversity game called 'Makrini'.
PIXEL's annual revenues have historically been from bespoke projects, with highest revenues of £527,279 in the year to 28 February 2009. In the year to 28 February 2011 PIXEL had revenues of £208,274 and an EBITDA loss of £57,000 and net liabilities of £32,000. PIXEL is moving increasingly to a business model focussed on selling 'off the shelf' library products via subscription and pay as you go revenue generation models. It has distribution arrangements in place in the UK and USA. The Directors believe that Intellego's established corporate client base will accelerate sales in the UK market.
PIXEL sells to a range of large corporations in the UK and North America and its customer list includes a major oil company, manufacturer of computers and related products as well as consultancy and accounting practices.
The initial consideration is £160,000, to be satisfied by the issue of 40,000,000 new ordinary shares at a price of 0.4 pence per share ("the New Ordinary Shares") with further issues dependent on performance after the end of the year to 28 February 2012 and 2013. The maximum total consideration is £1,100,000 to be satisfied in each case by the issue of new Ordinary Shares at 0.5 pence per share.
Application will be made for the New Ordinary Shares, which will rank pari passu with all existing ordinary shares, to be admitted to trading on AIM. Admission is expected on or around 9 May 2011. Following Admission, the enlarged share capital of the Company will be 431,446,682.
At completion Andy Hasoon, a director of PIXELearning Ltd, will be appointed an executive director of Intellego. Andy Hasoon, 39 has been involved in training since 1994, in 1999 he set up Courseleader.com, a business which specialised in IT training and in 2003 founded 50 Lessons, which was acquired by Skillsoft.com in 2011.
Andy Hasoon said 'There is considerable opportunity to grow both the PIXEL and Intellego businesses organically and through M&A activities. The elearning market is highly fragmented and I have been invited on to the Intellego Board to help execute that strategy.'
Commenting Angus Forrest, Chairman of Intellego, said ' This acquisition will advance Intellego's development as a top end digital learning business differentiating its offering from competitors , introducing new customer opportunities and generating income from the company's own intellectual property.
We are pleased Andy Hasoon is joining the Board, as he will increase the Company's experience and contacts within the learning sector.
We are reviewing other acquisition opportunities and if we are able to agree terms expect to make further announcements in the next six months.'
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