CLL.L Regulatory News (CLL)

18 Jul 2005 07:00

Cello Group plc18 July 2005 CELLO ACQUIRES THE VALUE ENGINEERS Cello Group plc ("Cello"), the marketing services group which listed on AIM inNovember 2004, has acquired The Value Engineers Limited ("The Value Engineers"),a leading brand and marketing consultancy, for a total maximum consideration ofup to £7.15 million in cash, loan notes and new ordinary shares. The Value Engineers, formed in 1986 by Paul Walton & Graham Harding, will joinCello's brand development platform. It works with a range of leading brandsincluding Unilever, Carlsberg, Diageo, Sony Ericsson, ICI, Visa, T-Mobile, BPand Britvic. The initial consideration consists of £4.48 million, of which £2.24 million isin cash and loan notes and the balance satisfied by the issue of 1,877,619 newordinary shares at completion. In addition, there is a maximum deferredconsideration of up to £2.67 million dependent on the financial performance ofthe business for the period to 31 December 2008. The deferred consideration ispayable in a mixture of loan notes and new ordinary shares at Cello'sdiscretion. The maximum share element will be 75% of the deferred consideration. For the year to 31 December 2004, The Value Engineers had a turnover of £3.7million, gross profit of £2.9 million and profit before tax of £0.64 million andwill deliver net assets of approximately £0.65 million at completion. Application will be made to the London Stock Exchange for the new shares to beadmitted to AIM and it is expected that admission will take place by 22 July2005. Kevin Steeds, Cello Chairman, said: "The Value Engineers is a business we have known and respected for a long time.It adds significant depth to our brand and marketing consultancy offer, with anexcellent, committed management team and client franchise. This furtherreinforces Cello's positioning at the high value added end of the marketingservices spectrum." 18 July 2005 Enquiries: Cello GroupKevin Steeds, Executive Chairman 020 7457 2020Mark Scott, Chief ExecutiveCollege HillAdrian Duffield/Clare Warren 020 7457 2020 Notes to Editors (www.cellogroup.co.uk) Cello Group plc is a marketing services group which listed on AIM in November2004. The Group's strategy is to create value for shareholders by building a portfolioof companies around three specialist platforms, each operating within adifferent niche of the UK marketing services sector: market research, branddevelopment, and direct marketing and database management. Following the completion of the acquisition of The Value Engineers, Cello willhave annualised turnover of approx. £55 million, annualised gross profit of some£27 million and employ approx. 340 people. Each platform has significant organic and acquisitive growth potential; bluechip client relationships with a history of client loyalty; experienced, highquality management teams; and a track record of profitability. Market Research • Insight Research Group - London and New York Insight is a specialist healthcare market research business which offers a broadrange of quantitative and qualitative research solutions. Its clients includeGlaxoSmithKline, Novartis, AstraZeneca, Shire Pharmaceuticals, NovoNordisk,Boehringer Ingleheim, Lundbeck, Pfizer, Roche and Merck, Sharp and Dohme. • Leapfrog Research & Planning - Windsor Leapfrog is a leading consumer market research and planning business. It actsfor a number of blue chip clients including Tesco, GSK, BBC, Scottish Courage,AA, RHM and Wyeth. Brand Development • Leith - Edinburgh and London Leith is the largest and most successful advertising agency in Scotland. Theagency has been voted Scottish Agency of the Year for the last five years.Leith opened a London office in 2000. Leith's major clients include StandardLife, Irn Bru, Scottish Executive, Carling, Standard Life Bank, Hotpoint andGoodfellas Pizza. Direct Marketing & Data Base Management • Target Group - Cheltenham and Cirencester Target is the leading direct and database marketing consultancy specialising inthe "not-for-profit" and charity sector. The agency works for five of the top20 charities in the UK. Target is expanding into the "grey sector" of productsand services for older people for clients such as National Trust, Saga andWhich? Limited. • Navigator Responsive Advertising - Edinburgh Navigator Responsive Advertising, Scotland's leading direct marketing agency,provides responsive communication solutions for a wide range of clientsincluding HBOS Group, De Vere Resort Ownership, ScottishPower, Scottish Widows,Intelligent Finance and Remy Martin. This information is provided by RNS The company news service from the London Stock Exchange