NEW YORK,
Jan. 6, 2022
/PRNewswire/ -- Stagwell Inc. (NASDAQ: STGW) announced today it has
acquired the remaining 49% of Instrument, a leading digital brand
and experience innovation company. Founded in Portland, Oregon, Instrument is one of
Stagwell's fastest growing agencies and employs over 400 people
working on clients including Nike, Google, Salesforce and Epic
Games. Stagwell's predecessor company, MDC Partners, had
acquired 51% of Instrument in 2018.
"Instrument is all in with Stagwell," said Stagwell Chairman and
CEO Mark Penn. "Instrument is a
first-rate digital company, having grown over 30% annually in each
of the past two years. The entire leadership team has done an
excellent job of growing their business while developing a culture
of innovation, inclusion and outstanding client service. We
are pleased to welcome Instrument into the network fully and to
have Justin, JD and their team onboard for the next phase of the
company's growth and development."
"We believe in Instrument's future with Stagwell and are pleased
to take the final step into the network," said Instrument CEO
Justin Lewis. "We are looking
forward to being a full part of Stagwell and the Constellation and
to the growth and development opportunities this investment will
provide for our team."
Stagwell's additional investment in Instrument fully aligns
Stagwell with one of its fastest-growing businesses, provides for
easier-to-scale digital operations and creates greater certainty
for investors through full-ownership. The deal includes a fixed
payment amount spread across a three-year term, split between cash
and stock in STGW. This mutually beneficial structure provides
Instrument's management with appropriate incentives for their
efforts and creates significant shareholder value.
The completion of the current transaction brings to a close the
uncertainty associated with uncapped earn-outs for all prior
investments and greatly improves management of leverage and
investment returns. With this deal, all previous uncapped earn-out
deals have now been restructured. Stronger than expected free cash
flow from Stagwell's consolidated operations combined with the
cash/equity payment structure enabled Stagwell to move forward with
the completion of this acquisition at this time while further
deleveraging the company's balance sheet.
"We have moved to expand our portfolio of high growth digital
assets, increase free cash flows, effectively manage leverage and
end uncapped earn-out structures," said Stagwell Chief Financial
Officer Frank Lanuto.
About Stagwell Inc.
Stagwell is the challenger network built to transform marketing.
We deliver scaled creative performance for the world's most
ambitious brands, connecting culture-moving creativity with
leading-edge technology to harmonize the art and science of
marketing. Led by entrepreneurs, our 10,000+ specialists in
20+ countries are unified under a single purpose: to drive
effectiveness and improve business results for their
clients. Join us at www.stagwellglobal.com.
Contact: Beth Sidhu
beth.sidhu@stagwellglobal.com
202-423-4414
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SOURCE Stagwell Inc.