Proposed Acquisition of MoneySavingExpert for up to £87 million
01/06/2012
MoneySupermarket.com Group plc
(“MoneySupermarket.com” or the “Company”)
today announces that it has conditionally agreed to acquire
MoneySavingExpert as a going concern from Martin Lewis and
MoneySavingExpert.com, for consideration of up to £87 million
(the “Acquisition”).
MoneySavingExpert operates one of the UK’s leading
personal finance and personal finance journalism websites which was
established in 2003 by personal finance journalist Martin Lewis.
According to Google Analytics, the MoneySavingExpert website
attracted approximately 39 million unique visitors and
approximately 277 million page impressions in the year ended 31
October 2011.
In the year ended 31 October 2011, MoneySavingExpert reported
revenues of £15.773 million (2010: £11.361 million) and
EBITDA of £12.642 million (2010: £8.379 million).
The MoneySavingExpert website offers free online services,
including information to its users, which MoneySavingExpert has
researched including in the areas of credit cards and loans,
shopping, deals and vouchers, utilities and phones, banking and
saving, travel and motoring, insurance, mortgages and homes, and
income and family. MoneySavingExpert’s services include a
range of online tools, researched articles in respect of specific
products, personal finance guides, weekly newsletter emails which
are sent to subscribers, online forums and a blog written by Martin
Lewis. Martin Lewis and the MoneySavingExpert website also provide
information and promote topical consumer focused issues such as
financial education in schools and reclaiming payment protection
insurance.
MoneySupermarket.com is MoneySavingExpert’s largest
provider, with payments made by MoneySupermarket.com to
MoneySavingExpert representing approximately 59% per cent of
MoneySavingExpert’s revenues for the year ending 31 October
2011, as a supplier of links to product providers mentioned within
MoneySavingExpert’s editorial and direct links to
MoneySupermarket’s price comparison services. The other
providers of MoneySavingExpert are predominantly other
intermediaries, including a number of other price comparison
websites. MoneySavingExpert does not tend to have direct
relationships with financial product providers, however
occasionally direct links are included on the MoneySavingExpert
website.
Highlights
- MoneySavingExpert business to be acquired for a total
consideration of up to £87 million
- £35 million upfront cash and approximately 22.1 million
MoneySupermarket.com shares
- deferred consideration of up to £27 million subject, in
part to the future performance of MoneySavingExpert against non
financial metrics and, in part, to MoneySupermarket.com’s
discretion
- Acquisition to be funded out of existing cash resources and
from a new £20 million bank facility
Benefits of the Acquisition
- Value proposition:
- Attractive acquisition multiple
- Expected to be earnings enhancing in the first full financial
year of ownership
- Corporation tax relief expected to be available on virtually
all of the consideration payable
- Combination supports and enhances MoneySupermarket.com’s
strategy through:
- Enhancing MoneySupermarket.com’s brand and user
content
- Growing MoneySupermarket.com’s direct-to-site revenues
and improving MoneySupermarket.com’s customer experience
- Utilising MoneySupermarket.com’s skills to optimise
MoneySavingExpert’s website and user
experience
On completion, Martin Lewis will become an employee of the
MoneySupermarket.com group and his role will be editor-in-chief of
MoneySavingExpert. As editor-in-chief he will lead the editorial
team of MoneySavingExpert. MoneySupermarket intends to preserve the
editorial independence – free of commercial considerations -
of MoneySavingExpert. In order to ensure this MoneySupermarket and
MoneySavingExpert have agreed an editorial code.
Timetable
Due to its size the Acquisition is required to be conditional
upon MoneySupermarket.com shareholder approval. Completion is also
conditional upon certain other conditions, including obtaining
certain competition authority approvals. A circular containing the
notice convening a general meeting of the Company will be sent to
shareholders shortly and completion of the Acquisition is expected
by September to October 2012.
Simon Nixon has irrevocably agreed to vote in favour of the
resolution to be proposed at the General Meeting in respect of his
beneficial holding which amounts to 267,257,021
MoneySupermarket.com shares or 52.48 per cent of the existing
issued ordinary share capital (excluding Treasury Shares) of the
Company.
Commenting on the Acquisition, Peter Plumb, Chief Executive
Officer of MoneySupermarket, said:
“We’ve worked closely together for years with
the common goal of helping customers save money. By joining forces
we can get more people to save more money. We’ll help
MoneySavingExpert.com reach a wider audience and
MoneySavingExpert.com will broaden the range of advice and tools we
offer, encouraging even more people to take action, tap into the
benefits of the internet to find a better deal and make the most of
their money.
“MoneySavingExpert.com is rightly trusted by its users
as a unique source of independent information and views in
today’s complex financial world. We are committed to
maintaining its trusted, independent, reputation. MoneySupermarket
will continue to source even better product offerings for customers
and further our goal of saving more customers more money in our
quest to save UK consumers £2bn a year by 2014.
“Following completion of the purchase I look forward
to welcoming the team of MoneySavingExpert.com to the
MoneySupermarket team, led by their founder, Martin Lewis who will
be editor-in-chief of the MoneySavingExpert.com
site.”
Martin Lewis, MoneySavingExpert, added:
“This is great news for MoneySavingExpert.com and its
users, ensuring, with or without me, the site will be around for
many years to come, maintaining our ethos of ‘cutting your
costs and fighting your corner’.
“MoneySavingExpert.com has become part of
people’s daily lives, far bigger than the man who founded it,
and now is the right time for it to stand on its own two
feet.
“I chose MoneySupermarket to work with as I know and
trust them. They understand the site, as they’ve shown by
agreeing the Editorial Code, which ensures our content can proudly
remain editorially independent and free from commercial
considerations.
“I’m chomping at the bit to get going, and come
up with new ways to help people save cash and continue campaigning
on issues such as PPI and getting financial education on the
curriculum. In keeping with the site’s aims, when the deal
completes, £10 million will go to charity, including £1
million to Citizens Advice, which is facing terrible funding
cuts.”
Conference call
A conference call for analysts and institutional
investors will be held today at 11.00am.
The participant dial-in is +44 (0)20 3140 0668 or +44 (0)800
368 1950 (toll free). The participant PIN code is 142581#.
A copy of the investor presentation is available through the
Investors Relations section of MoneySupermarket.com’s website
at: http://corporate.moneysupermarket.com/
Credit Suisse Securities (Europe) Limited is acting as sponsor
in connection with the Acquisition
For further information, please contact:
MoneySupermarket.com Group plc
Susannah Clark - +447788405224
Credit Suisse Securities (Europe) Limited
George Maddison - +4420 7888 8888
Chris Byrne - +4420 7888 8888
Maitland
William Clutterbuck - +44207 379 5151
Emma Burdett - +44207 379 5151
MoneySavingExpert.com
Tim Grey - +447796072298
MoneySavingExpert.com office - - +442073489100
Credit Suisse, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting for
MoneySupermarket.com Group plc and for no-one else in connection
with the Acquisition and will not be responsible to anyone other
than MoneySupermarket.com for providing the protections afforded to
clients of Credit Suisse or for providing advice in relation to the
Acquisition.