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IN BRIEF: Public Policy buys TrailRunner for up to USD70 million

27th Jan 2025 21:34

Public Policy Holding Company Inc - Washington, DC-based group of advisory firms, specialising in government affairs and public relations - Agrees to buy TrailRunner International LLC, a Texas-based global communications advisory firm, for initial USD33 million. On completion, the acquisition is anticipated to be immediately accretive to the underlying earnings. Consideration could rise to USD70 million if TrailRunner was to realise more than 25% compound annual profit growth from 2025 through 2029. The initial USD33 million payment will be satisfied on completion, which is expected to occur by April 1, by the issue of just under 3.0 million shares at 135.31 pence each, raising USD5.0 million and the balance of USD28.0 million in cash. To support the financing of the initial cash element, the group has entered into a supplemental credit facility with Bank of America of USD24 million.

In addition, says full-year 2024 revenue increased by 11% to USD149.6 million from USD135.0 million a year prior. Organic growth of 2.7% was the outcome of slower organic growth of 1.2% in the first half, followed by stronger organic growth of 4.1% in the second. Underlying earnings before interest, taxes, depreciation and amortisation increased 3% to USD36.1 million and was achieved at a margin of 24.1%.

Believes that in the coming months and years there is a significant opportunity to deploy further significant growth capital into such opportunities to enhance cash generation and better drive long-term shareholder returns. However, also believes the current share price does not support funding these M&A initiatives through the issuance of new equity and, therefore, will consider a proposal by management to adjust the dividend in order to retain more cash within the business.

Current stock price: 134.58 pence, down 0.3% in London on Monday

12-month change: up 19%

By Jeremy Cutler, Alliance News reporter

Comments and questions to [email protected]

Copyright 2025 Alliance News Ltd. All Rights Reserved.

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