27th Jul 2007 07:00
YouGov PLC27 July 2007 27 July 2007 YOUGOV EXPANDS INTO EUROPE WITH €21 MILLION ACQUISITION IN GERMANY YouGov Plc ("YouGov"), the online market research agency, today announced itsfirst acquisition in Europe, having conditionally reached agreement to acquirepsychonomics AG, a German-based market research and consulting agency for aninitial consideration of €20.75 million and a maximum consideration of €23.75million. psychonomics was incorporated in 1992 and is headquartered in Cologne withoffices in Berlin. The company offers market research services (includingonline) across various industries in Germany, and focuses on the insurance,financial services and healthcare sectors. YouGov sees considerableopportunities for the application of its online market research services inthese areas. As one of Germany's top ten market research agencies, psychonomics has a diverseclient base including blue chip clients such as Allianz, Bayer, L'Oreal andSiemens. YouGov expects its online-based market research services, such asOmnibus and BrandIndex, to prove attractive to psychonomics' client base. In the year ending December 2006, psychonomics grew profit before tax by 48% to€1.1 million (from €0.7 million) on revenues up 32% to €13.6 million (from €10.2million), ahead of the German market research market, which grew at 13.1%. Thenet assets of psychonomics at the year ended December 2006 were €1.3m. The boardof YouGov believes that the acquisition of psychonomics will be earningsenhancing in the first full year following completion of the acquisition. The initial purchase price of €20.75 million includes €5 million payable inYouGov shares with the balance in cash. Under the terms of the agreement, thevendors cannot transfer their YouGov shares for at least 12 months followingcompletion of the acquisition. Of the initial cash consideration €3.15 millionis payable as a non-refundable deposit. Two earnouts have also been put in placefor the years ending December 2007 and 2008 and, based on financial targetsbeing met, a maximum of a further €3 million would be payable, either in cash orYouGov shares. In addition to the purchase price payable, YouGov shares to thevalue of €500,000 will be issued for a psychonomics employee incentivisationprogramme. The purchase agreement is conditional upon funding by YouGov. YouGov has securedagreement in principle from The Royal Bank of Scotland for the provision offinance which may be used for the cash element of the initial considerationpayable. All YouGov businesses continue to perform well with increased investment inpeople and infrastructure. With trading in line with market expectations, thedirectors are confident that the 2007 financial year will be another successfulyear, both financially and operationally. Commenting on the acquisition, Nadhim Zahawi, CEO of YouGov said: "This is our first acquisition in Europe and gives us a strong foothold in theworld's third largest market research market where psychonomics has a top tenmarket position. On completion, YouGov will have a presence in the world's topthree global online market research markets - the US, UK and Germany.psychonomics focuses on what YouGov sees as growth markets such as insurance,financial services and healthcare and has a blue chip client base. We believethat bringing to bear our proven online market research techniques will furtherexpand its services to clients. "We see a major opportunity to migrate parts of psychonomics' traditional datacollection to our online technology, in addition to transferring its existingonline research to the YouGov platform. YouGov believes that both businesseshave an established presence in organisational consulting which demonstrates thecomplementary nature of the companies. We also believe that organisationalconsulting offers good opportunities to expand the services of the businesses.This is an excellent purchase which meets our well defined acquisitioncriteria." Professor Horst Muller-Peters, CEO of psychonomics, said: "We see YouGov as a great fit with ourselves: culturally and organisationally,particularly given their complementary market research services and their desireto build a European presence. We operate in high growth markets, and believethis has been reflected in our strong financial performance over recent years.We're excited about becoming part of a larger market research group with astrong presence in online research and expanding our methods into the YouGovgroup and promoting YouGov in the German speaking world." Ends Enquiries: YouGov plc Nadhim Zahawi 07803 293 019 Katherine Lee 020 7012 6000 Numis James Serjeant 020 7260 1309 Financial Dynamics Tim Spratt / Nicola Biles 020 7831 3113 Note to Editors: Founded in May 2000, YouGov is a market research agency pioneering the use ofthe Internet and information technology to collect higher-quality, in-depth datafor market research and public consultation. For the half year to 31 January2007, YouGov, which lifted UK client numbers 46 per cent to 263, grew pre-taxprofits by 64% to £2.3 million on a turnover of £6.1 million. YouGov's embryonicMiddle Eastern arm was boosted by acquisition last year and grew revenues by 53%in the first half of the financial year. Through a 32% interest in Polimetrix,the Group has a presence in the US. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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