Next Fifteen Communications Group PLC (AIM:NFC) has confirmed the acquisition of Engine UK for an enterprise value of £77.5mln.
Reported to be close a week ago, Engine UK is a broad-based digital transformation, communications and creative business with approximately 600 staff and 300 UK and international clients.
The acquisition will be funded by a placing to raise up to £50mln.
Engine UK specialises in corporate strategy, positioning and communications from its three divisions.
The client base includes high profile public clients such as the UK’s Home Office and the Ministry of Justice as well as household names such as AstraZeneca, E-ON and Sky.
In the year ended 31 December 2021, Engine UK increased its net revenue by 18% to £88.6mln and generated underlying profits (adjusted EBITDA) of £11.8mln.
The acquisition is expected to be high single-digit earnings enhancing in the first year with cost synergies of at least £3mln from the year to 31 January 2024, according to Next 15.
“Engine’s Creative division is a highly regarded and award-winning digital creative agency which the company plans to merge with its ODD creative agency to deliver a digitally native, data-driven creative agency,” it said.
Tim Dyson, Next 15’s chief executive, added: “Acquiring this broad-based digital transformation, communications and creative business fits well with our track record and strategy of adding growth businesses which then contribute to our target of doubling the size of our business in the next three to five years.
"Its three businesses are home to great talent and strong client relationships and provide multiple opportunities to expand and further apply our growth consultancy services.”