Mobile services company Zamano has agreed to a reverse takeover of Ireland-based provider of digital entertainment to mobile devices Red Circle for E24.4m. The acquisition is expected to increase the subscriber base and expand the range of demographics that Zamano serves in the UK, US, Ireland, and Australia.
Zamano will pay E17.2m initially and additional E7.2m if Red Circle achieves E3.9m EBITDA for the three months ending December 2007. Red Circle, which has over 500,000 subscribers in the US, UK and Australia, generated E31.1m in revenues for the year ended May 2007.
The acquisition more than doubles Zamano’s revenue on a pro-forma basis. Red Circle is Zamano’s fifth acquisition overall and the second in 2007; the Directors are confident that this will be another successful transaction. The company will continue to seek further organic and inorganic opportunities for growth in line with the strategy, said John O’Shea, managing director at Zamano.
The total headcount in Zamano will reach 68 after the addition of 28 Red Circle employees. The company expects pre-tax cost savings of at least E500,000 per annum once the full benefits of the acquisition are realized.
In April 2007, Zamano acquired another mobile content provider, Eirborne, for E8.5m to expand its geographic reach in the UK, Ireland and Australian markets.
Source: ComputerWire daily updates