TIDMATG
RNS Number : 0806P
Auction Technology Group PLC
07 February 2023
AUCTION TECHNOLOGY GROUP PLC
ACQUISITION OF ESTATESALES.NET
London, United Kingdom, 7 February 2023 - Auction Technology
Group plc ("ATG", "the Company", "the Group") (LON: ATG), operator
of world- leading marketplaces for curated online auctions, is
pleased to announce the acquisition of Vintage Software LLC (the
"Acquisition"), trading as estatesales.net ("ESN"), a leading US
estate sales listing site.
Background
Based in Jackson, Missouri, ESN provides a platform to
facilitate estate sales across the US. Both corporate estate sale
companies as well as private customers use ESN to advertise online
the sale of millions of unique second-hand items sourced from a
range of events including private home estate sales and business
liquidations.
Approximately 58% of revenue is derived from ESN's over four
thousand monthly listing subscribers, with the remaining 42% from
other fees, which predominantly includes traditional pay per
listing fees. The website attracts over three million monthly site
visitors, as well as over one million email subscribers, who are
primarily buyers looking to discover unique items for sale at local
estate sale events. Three quarters of all listings relate to
in-person sales, with the remaining predominantly sold through
third-party online auction sites. ESN also has a nascent
marketplace capability with over 125,000 items sold in 2022
directly through the site. ESN was founded by the McQuade family
and launched under its current name in 2002. Today, the company is
run by Micky McQuade, and prior to the Acquisition was wholly owned
by the McQuade family.
Rationale for the Acquisition
-- The Acquisition expands ATG's immediately addressable market
into the growing and fragmented US estate sales market, which had
an estimated gross merchandise value of $5bn(1) in 2022.
-- Consistent with ATG's strategy, this represents a strong
entry point into an attractive adjacent channel for the resale of
second-hand items and is consistent with ATG's purpose to
accelerate the growth of the circular economy.
-- ESN is a market leader in an industry vertical at the start of its digital transformation.
-- ESN's seller and buyer bases are highly complementary and
synergistic to ATG, providing the opportunity to drive more buyer
traffic to ATG's marketplaces, convert browsers of ESN to online
auctions and enable sellers to cross-list across multiple ATG
marketplaces.
-- The acquisition also provides the potential to leverage ATG's
existing marketplace technology, experience and value-added
services to customers of ESN and grow the online estate sales
marketplace offering.
1. Management estimates January 2023
Financial consideration
The Acquisition purchase price is $40 million with an initial
cash payment of $30 million plus deferred cash consideration of $10
million payable after twelve months. A total of up to $2 million
employee retention bonus will also be payable after 12 months to
certain employees of ESN. The acquisition will be funded from the
Group's available cash balance and existing debt facilities.
For the year ended 31 December 2022, ESN unaudited revenue was
$8.7 million, with an unaudited EBITDA of $4.7 million and
unaudited gross assets of $1.3 million. Revenue has grown at a c.9%
CAGR since 2019. The Board expects the acquisition to be accretive
to the Group's adjusted earnings and adjusted EBITDA in the current
financial year.
ATG also confirms its full year guidance provided at the FY 22
Results in December 2022, before the impact of today's
announcement.
John-Paul Savant, Chief Executive Officer of Auction Technology
Group plc, said:
"As a leading US estate sale listing site, estatesales.net is a
natural fit for ATG as we unlock further areas of value within the
secondary goods market and facilitate another part of the circular
economy. We are excited by the multiple growth opportunities ahead,
including enabling more sellers of unique and specialised secondary
items to cross-list across multiple marketplaces and gain access to
a larger pool of bidders and buyers, as well as the opportunity to
develop ESN into the leading online estate sales platform in the
US. We look forward to welcoming Micky and the estatesales.net team
into ATG."
For further information, please contact:
ATG
For investor enquiries, Rebecca Edelman rebeccaedelman@auctiontechnologygroup.com
For media enquiries press@auctiontechnologygroup.com
Tulchan Communications +44 207 353 4200
(Public relations advisor to ATG) ATG@tulchangroup.com
Tom Murray, Matt Low, Arthur Rogers
About Auction Technology Group plc
Auction Technology Group plc ("ATG") is the operator of world
leading marketplaces and auction services for curated online
auctions, seamlessly connecting bidders from around the world to
around 3,800 trusted auction houses across two major sectors:
Industrial & Commercial ("I&C") and Art & Antiques
("A&A").
The Group powers seven online marketplaces using its proprietary
auction platform technology, hosting in excess of 70,000 live and
timed auctions each year. ATG has been supporting the auction
industry since 1971 and the Company has offices in the UK, US and
Germany.
CAUTIONARY STATEMENT The announcement may contain
forward-looking statements. These statements may relate to (i)
future capital expenditures, expenses, revenues, earnings,
synergies, economic performance, indebtedness, financial condition,
dividend policy, losses or future prospects, and (ii) developments,
expansion or business and management strategies of the Company.
Forward-looking statements are identified by the use of such terms
as "believe", "could", "should", "envisage", "anticipate", "aim",
"estimate", "potential", "intend", "may", "plan", "will" or
variations or similar expressions, or the negative thereof. Any
forward-looking statements contained in this announcement are based
on current expectations and are subject to known and unknown risks
and uncertainties that could cause actual results to differ
materially from those expressed or implied by those statements. If
one or more of these risks or uncertainties materialise, or if
underlying assumptions prove incorrect, the Company's actual
results may vary materially from those expected, estimated or
projected. No representation or warranty is made that any
forward-looking statement will come to pass. Any forward-looking
statements speak only as at the date of this announcement. The
Company and its directors expressly disclaim any obligation or
undertaking to publicly release any update or revisions to any
forward-looking statements contained in this announcement to
reflect any change in events, conditions or circumstances on which
any such statements are based after the time they are made, other
than in accordance with its legal or regulatory obligations
(including under the UK Listing Rules and the Disclosure Guidance
and Transparency Rules of the Financial Conduct Authority). Nothing
in this announcement shall exclude any liability under applicable
laws that cannot be excluded in accordance with such laws.
LEI Number: 213800U8Q9K2XI3WRE39
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