Raketech snaps up Lead Republik in €1.4m deal
Acquisition bolsters the Stockholm-listed affiliate’s offering in Canada and New Zealand
Raketech has acquired the assets and staff of affiliate network Lead Republik Ltd for an upfront payment of €1.4m.
The purchase price represents approximately 3x EBITDA and 0.5x revenue for Lead Republik during the past 12 months.
The deal, effective from today, includes earnouts, with part of the earnout capped up to a maximum €300,000 until 28 February 2021. The possibility of further uncapped payments is based on performance targets up until 28 February 2022.
Malta-registered Lead Republik predominantly generates revenue from Canada, New Zealand and Germany, which means Raketech’s revenue from outside the Nordics is projected to reach around 20% of group revenue.
However, Raketech acknowledged paid media – currently responsible for a “large portion” of revenue – is expected to lower EBITDA margin for the group slightly.
Oskar Mühlbach, CEO of Raketech, said: “This acquisition is ticking a lot of strategic boxes, as it gives us further footprint in markets important for our key partners at the same time as it contributes with technical know-how in the form of a high qualitative technical platform together within competence within conversion optimisation and paid media.
“We further see strong synergies when combining Lead Republik’s offering with our know-how, within organic search.”
He continued: “I am furthermore really glad to have the brilliant Lead Republik team on board and to be able to conclude that the sellers will continue their involvement for the upcoming 12 months in order to secure a smooth handover and accelerate further expansion into new markets.”
Last month, Raketech revealed Q4 2019 revenue slumped 23.3% year-on-year to €5.3m as new depositing customer numbers fell.
Raketech’s shares crept up 1.6% to SEK6.4 this morning on the Nasdaq First North Premier Growth Market.