TIDMKAPE
RNS Number : 8845W
Kape Technologies PLC
13 December 2019
13 December 2019
Kape Technologies plc
("Kape," the "Group" or the "Company")
Completion of acquisition of Private Internet Access
Further to the announcement on 19 November 2019 regarding the
proposed acquisition of Private Internet Access, Kape (AIM: KAPE),
the consumer security software business, is pleased to confirm that
completion of its acquisition of LTMI Holdings ("LTMI") for a total
consideration of c. US$95.51 million and an enterprise value of c.
US$127.6 million (the "Acquisition") will occur on 16 December
2019.
LTMI is the holding company for Private Internet Access ("PIA"),
a leading US-based digital privacy company with a strong position
in data privacy services.
The Acquisition is anticipated to be immediately earnings
enhancing, with the enlarged group expected to generate
consolidated proforma 2020 revenues of between US$120-123(1)
million, Adjusted EBITDA(2) of between US$35-38 million and
earnings accretion of approximately 90%.
In addition, the Acquisition will deliver substantial
operational benefits to Kape, transforming the Group's user base
with the addition of over one million customers, 48% of which are
based in the US. The acquisition includes an additional suite of
software-based privacy solutions available across mobile, tablet
and desktop and which includes Plus Ultra, a software that speeds
up internet connections, and LibreBrowser, a completely private
browser.
Ido Erlichman, Chief Executive Officer of Kape, commented:
"This transaction is in effect creating the first global privacy
and security company; and will allow us to accelerate our mission
to create a more transparent and secure online environment for our
customers. We are now extremely well-placed to provide a truly
secure and private online experience for all, with our aim of
enabling our customers to surf the web quickly, securely and
privately across all devices now becoming a reality for a growing
number of people worldwide"
Issue of Equity
As part of the consideration, Kape is issuing 42,701,548 new
Kape ordinary shares ("Consideration Shares") to be paid in three
phases. LTMI co-founders Andrew Lee and Steve DeProspero will each
be entitled to be issued 19,247,723 Consideration Shares
representing approximately 10.4% of the enlarged issued share
capital of Kape (assuming the issuance in full of all deferred
Consideration Shares following completion and excluding treasury
shares and shares held by the Kape EBT), of which 5,250,363 each
are being issued on completion, 10,498,020 each will be issued on
the first anniversary of completion and 3,499,340 each will be
issued on the second anniversary of completion.
The balance of the Consideration Shares, being 4,206,102 in
aggregate, are being issued to four senior executives of LTMI, of
which 1,147,333 are being issued on completion, 2,294,077 will be
issued on the first anniversary of completion and 764,692 will be
issued on the second anniversary of completion.
Application has been made for 11,648,059 Consideration Shares to
be admitted to trading on the AIM market of the London Stock
Exchange ("AIM") and it is expected that admission will take place
and trading in the 11,648,059 Consideration Shares will commence
from 8:00am on 16 December 2019.
(1) All US$ figures based on an assumed GBP/USD exchange rate of
1.281
(2) Adjusted EBITDA is a non-GAAP measure and a company specific
measure which excludes other operating income and expenses which
are considered to be one off and non-recurring in nature.
Enquiries:
Kape Technologies plc via Vigo Communications
Ido Erlichman, Chief Executive Officer
Moran Laufer, Chief Financial Officer
Shore Capital (Nominated Adviser & Broker)
Mark Percy / Toby Gibbs / James Thomas (Corporate
Advisory)
Henry Willcocks (Corporate Broking) +44 (0)20 7408 4090
N+1 Singer (Joint Broker)
Harry Gooden / George Tzimas +44 (0) 20 7496 3000
Vigo Communications (Financial Public Relations)
Jeremy Garcia / Antonia Pollock
kape@vigocomms.com +44 (0)20 7390 0237
About Kape
Kape is a leading 'privacy-first' digital security software
provider to consumers. Through its range of privacy and security
products, Kape focusses on protecting consumers and their personal
data as they go about their daily digital lives.
To date, Kape has over 1 million paying subscribers, supported
by a team of over 300 people across eight locations worldwide. Kape
has a proven track record of revenue and EBITDA growth, underpinned
by a strong business model which leverages our digital marketing
expertise.
Through our subscription-based platform, Kape has fast
established a highly scalable SaaS-based operating model, geared
towards capitalising on the vast global consumer digital privacy
market.
www.kape.com
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About PIA
PIA was established in 2009 and is a security software business,
based in Denver, Colorado, with a focus on the provision of virtual
private network ("VPN") solutions. Since its inception, PIA has
grown to become a leading VPN service provider focused on the
consumer market and employing approximately 65 employees, amongst
them 35% in an R&D capacity. PIA has over 1 million paying
subscribers globally, with 48% of them based in the US.
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END
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