Litebulb, the AIM-listed support services provider, has entered into a conditional share purchase agreement to acquire Bluwstuff, a designer of products primarily targeted at the gift and toy markets.
The initial consideration for the acquisition is 250m ordinary shares, with a further 125m ordinary shares dependent on various performance criteria.
In the year ending December 31st 2011, Bluwstuff recorded turnover of £4.6m and a loss before tax of £1.6m. Unaudited financial results for Bluwstuff for the 11 months to November 2012 reported revenues of £4.1m, and earnings before interest, tax, depreciation and amortisation (EBITDA) - a frequently used measure of operating profit - recorded a loss of £2,000.
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Litebulb stated that Bluwstuff is expected to record a positive EBITDA for the year ending December 31st 2012.
According to Litebulb, the acquisition of Bluwstuff would significantly enhance sales over the next 12 months and would be earnings enhancing before interest, tax, depreciation and amortisation.
The acquisition is further expected to provide a number of benefits to the enlarged group, including creating a group with higher turnover and rapidly enhancing Litebulb Group's position as a provider of niche consumer brands and products.
Simon McGivern, LiteBulb Group Chief Executive Officer, commented: "The acquisition of Bluwstuff is a further step in our strategy of expansion both organically and by targeted acquisitions.
"Given the similarities of the two businesses, the addition of Bluwstuff is a natural fit and it further positions LiteBulb Group as a leading developer of innovative branded products that are then distributed through an expanding network of blue-chip retailers and international distributors."
"The strong support from respected institutional investors for the fundraising is a further endorsement of our strategic plan and growth ambitions," he added.
MF
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