Marketing firm St Ives has acquired Branded3 Search, a search engine optimisation and digital marketing agency.
The company said that the acquisition of Branded3 represented a continuation of St Ives's strategy to create a complementary range of digital and marketing services that would enable the group to add further value to existing and new clients.
In the financial year ended January 31st 2013, Branded3 generated adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of £1.7m on revenue of £4.1m. Gross assets were £3.0m.
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St Ives said that it had agreed to acquire all of the issued share capital of Branded3, on a cash and debt free basis, for £10.7m, to be satisfied by approximately £8.6m in cash and approximately 1.4m of newly issued St Ives shares.
It said that a further consideration of up to £14.3m could be payable to be satisfied approximately 75% in cash and 25% in shares dependent on incremental financial performance for the years ending January 31st 2014, 2015 and 2016.
Branded3 is to operate as a subsidiary of St Ives and will continue to be managed from its current locations by its existing management team.
Patrick Martell, Chief Executive Officer of St Ives, said: "With the acquisition of Branded3 we are adding significant depth to our digital offering and further enhancing the range of marketing services we can provide for our existing and prospective clients."
He added: "Our combination of insight led innovation and trusted execution across digital and physical media creates a unique integrated offering in the market, which this acquisition complements well. I am delighted to welcome the Branded3 team to the group and look forward to supporting their growth plans."
Branded3's Chief Executive Officer Vin Chinnaraja, said: "We have achieved another major milestone in our growth plans and becoming part of a synergistic, forward-thinking group where there is huge potential for collaboration is a real boost for us. I am really looking forward to working with the St Ives team to fulfil our ambitious plans."
St Ives's share price was up 2.48% to 155.25p at 12:25 on Thursday.
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