Porta Communications has acquired the majority shareholding in media buying agency Twenty 20 Media Vision, in a deal worth around £1.9m.
Porta has announced the acquisition of 90 per cent of the share capital of the Tunbridge Wells media planner and buyer, which was formed around three years ago, working with clients including Carpetright, Fat Face, Raymond Weil Watches, Wren Kitchens and Gieves and Hawkes and reported net liabilities of £180,791 last year.
The deal will be linked to profits driven by Twenty 20 over the next 12 months, with an initial consideration of £370,000, paid with £40,000 in cash and the issue of 3,300,000 of ordinary shares at 10p each.
A deferred consideration of up to £1,530,0000 will be paid subject to a pre-tax profit before the company’s end of year in September 2013, of over £500,000. A maximum deferred payment will be made of up to £300,000 in cash, although should profits fall below £500,000 then the consideration will be reduced by £190,000 for every £50,000 the agency is short of its target.
David Wright, chief executive of Porta, commented: "Twenty 20 represents another key element in the Porta business plan. It not only represents the first significant development by Porta in the advertising space, but also provides the Group both the management expertise and market presence to further develop its plans for the sector. We are looking to build on this strong base with further acquisitions in the near future."
Bill Jones, managing director of Twenty 20, added: "Joining the Porta group presents the Twenty 20 team with the opportunity to fast track the next crucial stage of our growth plan. We will continue to expand both our media and creative client portfolios with particular emphasis on the retail and luxury goods sectors."