NewMedia SPARK plc (“SPARK” )
14th May 2007
NewMedia SPARK plc ("SPARK" )
Acquisition of Quester's early stage Technology and Life Science Fund Management Business with £200 million under management
NewMedia SPARK plc (AIM: NMS), the technology venture capital company, is pleased to announce that it has agreed to purchase the entire issued share capital of Querist Limited ("Querist''), the parent company of the Quester group of companies ("Quester"), an established manager of venture capital funds for early-stage Technology and Life Sciences.
• The initial consideration for the acquisition of £4 million will be satisfied in cash on completion, with a maximum deferred consideration of £1 million paid over two years, subject to revenue targets being met.
• A further cash amount (estimated to be approximately £0.4 million) will be payable on agreement of a Completion balance sheet in respect of surplus net assets acquired by SPARK.
Quester manages funds of over £200 million in the form of the Quester VCT's, Quester Venture Partners and several University Technology Transfer funds, £175 million of which are on long-term or rolling contracts. It has links with leading UK Universities, including the Oxford University Colleges. Across the funds there are 49 investments made between 1996 and 2007, of which approximately one third are in Life Sciences and two thirds in Technology. In the year ended 31 March 2007, Quester had an unaudited consolidated turnover of £5.1 million and profit of £0.1 million after deducting £1.4 million of non-recurring expenditure. At 31 March 2007, Quester had unaudited consolidated net assets of £0.4 million.
The Board believes that the acquisition will allow SPARK to deliver enhanced long-term returns for shareholders by expanding significantly its funds under management and providing a platform for managing additional funds from a number of sources in future. The increase in the scale of its operations will generate substantial efficiency improvements, create a wider spread of investments for co-investing SPARK shareholder funds, and provide greater access to the UK's best early-stage entrepreneurs, investment managers and University intellectual property - benefits which will also be shared by the investors in Quester funds. Together, the combined group will manage over £275 million of funds, of which over 63% are evergreen (open ended funds).
Andrew Carruthers, Chief Executive of SPARK, commented:
"We are delighted to be able to make this significant move in building upon our position in the investment community as one of the leading early-stage European venture investors by welcoming the Quester team. SPARK has demonstrated strong growth in net assets and a number of successful exits recently, after the difficult post-dotcom years. We have co-invested with Quester a number of times over that period and see them as one of only a few high quality participants in our sector. We plan to use this combined platform to build further funds under management and deliver long-term growth in shareholder value"
NewMedia SPARK plc
Andrew Carruthers 020 7851 7777
Collins Stewart Europe Limited
Seema Paterson 020 7523 8321
Isabel Podda 020 7466 5000
NewMedia SPARK is a quoted venture capital organisation based in central London focused on early stage investments in the technology, media and telecoms sectors. SPARK's portfolio has a particular emphasis on digital media, software applications, technology and communications. As an investor, SPARK expects to add significant value to its investments through active support and strategic direction. SPARK has been listed on London's Alternative Investment Market since 1999.
Recent successful exits for SPARK include the sale of Mergermarket to Pearson for £120 million, the sale of Footfall to Experian for £36 million and the sale of Elata to Qualcomm for $ 57million.
Further information is available at www.newmediaspark.com
Quester is one of the UK's leading venture capital companies and has been providing equity for growing technology companies for more than 20 years. It manages over £200 million on behalf of major institutional investors, leading UK universities, and three quoted venture capital trusts. Quester invests in the best technology to create world-leading businesses in the software, electronics and life sciences sectors. As well as capital, it brings a wealth of experience of developing high growth companies from early stage through IPO or trade sale.
Quester's passion is building great companies from small beginnings: its experience blends ambition with the strategic, financial and commercial skills to enable it to maximise returns, both for investors and for portfolio companies.
Further information is available at www.quester.co.uk