11 January 2012
Adventis Group Plc ("ATG.L")("Adventis" or the "Group")
Disposal of certain assets of Adgenda Media Limited
Adventis announces that after close of business yesterday it
sold the business and a number of assets (the
"Assets") of its remaining media buying subsidiary, Adgenda
Media Limited ("Adgenda"), to Mensola Co 116
Limited ("Buyer"), of which certain directors of Adgenda are
or will become shareholders (the "Disposal"). Immediately
following completion all direct employees of Adgenda will
transfer to the Buyer.
Under the terms of the sale agreement between Adventis,
Adgenda, the Buyer and the Buyer's guarantor Emerge Limited
(the "Sale Agreement"), the total consideration payable in
cash for the Assets is £506,000 of which £200,000 will be
paid in monthly cash instalments over the next 24 months. In
addition, as part of the consideration, the Buyer shall
assume and be responsible for the discharge of £845,000 of
trading liabilities of Adgenda. Adgenda will transfer
customer prepayments of £265,000 to the Buyer and will make
an equivalent payment for the assumption of those
obligations. Simultaneously, Adventis has settled a liability
of
£306,000 due to a director of Adgenda in respect of deferred
purchase consideration due under the terms of the 2005
agreement to acquire Adgenda, as varied by a supplemental
agreement in June 2010.
The Sale Agreement provides that Adgenda will retain all
trade debtors estimated at £1,200,000. It is envisaged that
proceeds from realisation of these debtors will be used to
settle certain residual creditors estimated at £600,000
retained by Adgenda under the Sale Agreement and to reduce
the Group's current bank indebtedness.
In the year ended 31 December 2010, Adgenda generated
turnover of £4,767,000, net revenues of
£1,064,000 and a profit before tax of £287,000. It is not
possible to reliably measure, and therefore disclose, the
profit attributable to the Assets from the Adgenda business
as a whole. At 31 December 2010 the Group carried
consolidation goodwill of £1,425,000 in relation to Adgenda:
an impairment charge of £74,000 will be recognised as a
non-cash item in the Group's financial results for the year
ended 31 December 2011.
The Disposal will reduce the Group's profits. However, as
announced in the Company's preliminary results on 27 May
2011, the Group is in a period of turnaround whereby "every
aspect of the business is subject to re-examination and
repair. Those business operations that are unviable will be
sold or closed if a buyer cannot be found". As part of this
process, the directors of Adventis (the "Directors") have
determined that the Group's media division is no longer core
to the Group and the Disposal follows the recent sale of the
trade and goodwill of the Group's other media subsidiary,
Adventis Media Limited (formerly Adventis Coltman Limited),
which was announced on 7 December 2011.
Following the Disposal, the Group's focus will predominantly
be on developing and growing its Technology division,
comprising bChannels Limited and Second2 Limited.
Certain directors of Adgenda are, or will become,
shareholders of the Buyer: they are not directors of
Adventis. However, the Disposal constitutes a related party
transaction for the purposes of AIM Rule 13 of the AIM Rules
for Companies (the "AIM Rules"). In accordance with the AIM
Rules, the Directors, having consulted with the Company's
nominated adviser, Arbuthnot Securities Limited, consider
that the Disposal is fair and reasonable insofar as its
shareholders are concerned.
Nick Winks, Chairman of Adventis, commented:
"Following the sale of Adgenda, the Group no longer has a
media division. More importantly, the Group can now focus on
its technology businesses where we believe there to be a
number of long term growth opportunities."
Nick Winks, Chairman
Andrew Pearson, Finance Director
Tom Griffiths
Rebecca Gordon
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