Next Fifteen buys TAG for up to £3.6m

Digital communications group Next Fifteen has acquired specialist technical content and digital marketing business Technical Associates Group (TAG) for up to £3.6m, in a deal that is expected to be earnings-enhancing in the year to 31 January 2019.

The initial consideration for TAG, which has offices in the UK, Germany, and Singapore, is £2.2m, which will be settled with £1.9m of cash and the issue of 67,750 new ordinary shares in Next Fifteen. A further deferred consideration of £0.6m is payable in April 2020, while a contingent consideration dependent on the combined EBIT performance of TAG and Publitek, an existing Next 15 business, is also payable in April 2020.

The maximum total expected consideration of £3.6m represents a 5x multiple on TAG’s average adjusted EBIT performance over the last 3 years ending 31 March 2018.

Once the deal completes, TAG will trade as a member of the Publitek group - Next 15’s global B2B technical marketing agency - with its managing directors Sylvia Laws and Ian Clay joining the Publitek board.

Publitek's founder and chairman, Bob Jones, said: "By bringing TAG into the Publitek group, we now offer clients of both businesses greater geographic reach and broaden our expertise for clients in the industrial engineering sector. What’s more, the team brings valuable digital skills and experience, particularly in marketing automation."

Sylvia Laws, managing director of TAG, said: "Everything about Next 15 and Publitek feels right - it is a win-win for our clients and our people. Now, without compromising on our brand purpose, we have a truly global presence, stronger influence in the tech, engineering and electronics markets and even greater insight across our key markets."

At 1235 BST, the shares were up 4.2% to 500p.