Taking 100% control of ReachFurther CommunicationsNovember 11, 2011
FOR IMMEDIATE RELEASE
11 November 2011
Taking 100% control of ReachFurther Communications
Globo plc (“Globo”; “the Group” LSE-AIM: GBO; www.globoplc.com), the international IT, S.a.a.S and mobile solutions group, announces that its subsidiary, Globo S.A., has completed the acquisition of ReachFurther Communications (“RFC”), the Cyprus-based value added service provider and content aggregator.
In January 2009, Globo acquired a 35% equity interest in RFC and management control of the business. Following the acquisition of the remaining 65% of the shares, RFC becomes a wholly owned subsidiary of Globo S.A.
RFC delivers services and content to mobile and fixed network operators in certain markets in Western and Eastern Europe where it has enabled Globo to establish its mobile applications business as well as accelerating development through RFC’s customer base which includes Vodafone, KPN Group, Wind, Cosmote Group and CYTA, as well as numerous value added service providers.
Over the past 3 years, RFC has been instrumental in positioning the Group within the mobile sector and contributing to both product development and sales of CitronGO! and GO!Social to mobile network operators and value added service providers.
RFC operates an active service development programme, creating new revenue streams and new opportunities for cross-selling Globo’s products. For example, RFC recently launched a mobile and web based top up service “Mobile Top Up” to provide an S.a.a.S alternative, for mobile operators and major wholesalers, for selling and distributing airtime to prepaid mobile users. It offers a significant opportunity to increase the prepaid mobile market in many countries where only traditional distribution channels are available. The first franchise agreement has been secured and the service will go live by the end of this year.
The consideration for the proposed acquisition of approximately £604,000 will be satisfied by the issue of 3,500,000 new ordinary 1p shares in Globo Plc to the vendor, Future Marketing Ltd, owned by Mr Nikos Giannakakos and Mr Grypaios Aggelos. The vendor has entered into a lock-in agreement for 6 months in respect of half of the new ordinary shares to be issued. Application is being made for the new ordinary shares to be admitted to trading on AIM, trading in such shares is expected to commence on 17 November 2011 and the new ordinary shares will rank pari passu with all existing ordinary shares in Globo Plc.
Since January 2009 when Globo acquired 35% of RFC, Mr Giannakakos has been Managing Director of Globo Mobile S.A. and is responsible for the mobile operations of the Globo group. Reach has already been fully consolidated in the Globo accounts as effectively Globo was controlling the management of the business.
On 1 October 2011, Mr Grypaios was appointed VP Group Business Development of Globo and is responsible for expanding the business and partnerships for the international mobile business.
For the first half of 2011, RFC delivered revenues of €0.495 million (H1 2010, €0.317 million), an increase of 56%, with revenues for the full year expected to be approximately €1.2 million. The strategic acquisition is expected to be earnings per share positive for 2011.
Costis Papadimitrakopoulos, CEO of Globo commented:
“Since our original investment nearly three years ago, RFC has played a key role, in its core markets, in establishing Globo as a leading mobile apps player. We believe that there is scope to build significantly on this success.
We expect that the full integration of RFC will strengthen Globo’s positioning in the mobile market and will help accelerate the international roll-out of GO!Enterprise Server.
Overall, our decision to take full control of RFC will enable Globo to take advantage of the joint opportunities we are developing, thereby enhancing growth in revenues and profits for the Group.”
Globo plc – www.globoplc.com
Costis Papadimitrakopoulos, CEO
Dimitris Gryparis, Finance Director
Daniel Stewart & Company Plc (Nomad &Broker)
Noelle Greenaway (Corporate Finance)
Martin Lampshire (Corporate Broking)