LINK Mobility Group ASA (“LINK” or the “Company), the leading provider of B2C mobile messaging and mobile services in the Scandinavian, Baltic and German markets, has entered into a term sheet regarding the acquisition of one of Spain’s leading providers of B2C mobile messaging services, the Didimo-JetTelecom Group (Didimo).
LINK intends to acquire all shares in the parent company Didimo Servicios Móviles SL, and thereby its fully owned subsidiary JetTelecom SLU, from the founder and CEO of Didimo Servicios Móviles SL, Carlos Cadenas, and his partners.
Didimo was established in 2010 and has 8 employees based in Madrid in Spain. Didimo is expecting to report a 2016 revenue of EUR 8.9 million and an EBITDA of EUR 1.22 million. Didimo has a strong position in the Spanish market for mobile messaging services. Didimo has a solid customer portfolio of large companies and SMEs. The company has a strong relationship with the telecom operators; it has direct connections to all the main operators in the Spanish market, and is running the solutions portfolio for Orange and Telefonica in Spain.
“By combing the experience, innovative forces and resources of Didimo and LINK, we will be well positioned to take on a leading position in the Spanish market. The whole Didimo team is eager to start leveraging all the synergies that will arise from our integration with the LINK Group” says Carlos Cadenas, CEO of Didimo.
“This is another milestone for the development of LINK into the leading mobile messaging and solution company in Europe, and our first step into South Europe. The Spanish market is under strong development and growth, and we view it as very attractive. Our ambition is to continue to drive consolidation in this market the same way that we have driven consolidation in the Nordic markets. We will strongly benefit from the good position Didimo has in the Spanish market, and plan to capitalise on this position with additional innovative mobile solutions in the future” says Arild E. Hustad, CEO of LINK.
The agreed enterprise value of Didimo is EUR 7.3 million, on a cash-free and debt-free basis and assuming a normalized level of working capital. The purchase price is based on a multiple of 6 times 2016 EBITDA. The enterprise value is based upon an estimated EBITDA for Didimo in 2016 of EUR 1.22 million, and will be subject to adjustments if the actual EBITDA differs from the expected EBITDA.
The purchase price under the transaction will, subject to customary adjustments, be settled as follows:
1/3 of the purchasing price in cash upon closing
1/3 of the purchasing price in shares in LINK valued at the lower of the closing share price at the Oslo Stock Exchange 12 January 2017 and the date of the closing of the transaction
1/3 of the purchasing price as sellers’ credit to be paid back no later than 36 months from closing. An interest of 5% accrues on the sellers’ credit annually, and is payable by LINK quarterly in arrears
The acquisition is conditional upon a satisfactory result of a confirmatory due diligence process to be performed by LINK, and upon LINK and the sellers agreeing on the terms and conditions of a final share purchase agreement for the consummation of the transaction, containing, inter alia, customary closing conditions. The acquisition is furthermore subject to approval of the Board of Directors of LINK.
LINK has a solid cash position due to strong cash flow from its operations and the successful private placement of NOK 125 million completed in late 2016. The cash part of the transaction will thus be fully financed through LINK’s corporate funds.
The transaction is expected to close on or about 31 March 2017.
For further information, please contact:
IR Contact Siw Ødegaard
LINK Mobility Group ASA
Mob: +47 95 75 98 48