Bulk-email specialist Dotdigital Group PLC (LON:DOTD) has taken another step towards becoming the go-to “omni-channel marketing automation platform” after snapping up customer engagement group Comapi for £11mln.
A further £1.2mln in share options is potentially due to the Cheltenham-headquartered business depending on its performance over the next couple of years.
Comapi specialises in ‘live chat’ and has built a software platform that allows clients to communicate directly with their customers via email, SMS and social messaging apps.
Dotdigital said the deal would make it the “most advanced platform” on the market and make it more relevant in the lucrative Asian market.
“By adding Comapi to our business, dotdigital is executing on its vision to be an omni-channel marketing automation platform,” said Dotdigital chief executive Milan Patel.
“Comapi has built an impressive platform that, integrated with our software, will allow our customers access to the next generation of consumer engagement marketing technology aiding retention and boosting our competitive advantage in securing new customers.”
Comapi generated underlying earnings (EBITDA) of £1.2mln in the year to December 2016, on revenues of £7.8mln. On completion of the deal, it will have a positive net asset position, Dotdigital said.
Good use of spare cash, says broker
“With the three organic routes to growth demonstrated ably with strong final results (and a particularly strong second half) revealed in October, dotDigital is now making best use of cash resources in acquiring further impetus to growth,” wrote finnCap analyst Andrew Darley.
“Comapi, acquired for £11m initial consideration with further deferred conditional consideration of £1.2m in shares over two years, provides omni channel messaging and cloud communication: this extends dotDigital’s platform, maintaining its market leading integrated functionality; allows a more personalised service for clients across multiple communications channels (email, SMS, twitter etc); and positions the group well for the Asian market, which remains mobile led.”
Darley has lifted his full-year underlying earnings forecast by 12% for 2018 and 14% for 2019, while the analyst has also upped his price target to 100p.
Shares were up 5.2% to 91.5p in late morning trade on Wednesday.
--Updates for share price and broker comment--