Mobile Embrace Ltd (ASX:MBE) has acquired C2B Solutions Pty Ltd, a profitable and strategically compelling performance marketing company, for an overall consideration of $6.5 million.
The consideration will include an upfront payment of $2.5 million.
In addition to the upfront consideration and subject to achieving targeted earnings over the next 2 years, there will be additional cash consideration of $2 million for each year of successful achievement.
The technology-led digital performance marketing company’s shares were last trading 8.6% higher intra-day, at $0.076.
Performance Marketing refers to online marketing and advertising programs in which advertisers and marketing companies are paid when a specific action is completed; such as a sale, lead or click.
Significantly, the strategic acquisition enables Mobile Embrace to benefit more from C2B’s digital performance marketing positioning to deliver more sustainable growth.
Drawing on proven expertise and intellectual property (IP) in call centre development and management, C2B has delivered successful and profitable outcomes for its clients.
Mobile Embrace has financial flexibility to fund and grow its business
The vertical integration of C2B’s call centre IP and expertise into Mobile Embrace’s digital performance marketing infrastructure is expected to expand the addressable market for business growth.
Importantly, C2B is forecast to generate an EBITDA of $2.5 million for FY2018 which means the acquisition of the business will be immediately EPS accretive to Mobile Embrace.
The acquisition is in line with the company’s strategy of establishing a larger, more dominant digital performance marketing business across Australia, New Zealand and the UK.
Mobile Embrace’s balance sheet and financial position remains strong following the completion of the acquisition, with further financial flexibility to fund and grow its business.