TIDMDATA
RNS Number : 5942X
GlobalData PLC
21 December 2023
21 December 2023
FOR IMMEDIATE RELEASE
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (596/2014/EU) AS THE
SAME HAS BEEN RETAINED IN UK LAW AS AMENDED BY THE MARKET ABUSE
(AMENDMENT) (EU EXIT) REGULATIONS (SI 2019/310) ("UK MAR").
GlobalData Plc
(AIM: DATA; "GlobalData", "the Company", "the Group")
GlobalData announces a Group reorganisation and enters into a
transformational investment agreement with Inflexion for a
significant minority stake in its Healthcare division
Highlights
-- Launch of new growth plan and Group reorganisation to operate
across three customer-focused divisions - Healthcare, Consumer, and
Technology.
-- Inflexion acquires a 40% shareholding in GlobalData's
Healthcare division at a valuation of GBP1,115m, which represents a
22x multiple of June 2023 LTM EBITDA for the division (on a
standalone basis).
-- This compares to a market capitalisation of GBP1,352m for the
entire GlobalData Group (at the close of market on 20 December).
The Healthcare division represented 36% of GlobalData Group's June
2023 LTM revenue.
-- GlobalData Plc expects to receive net cash proceeds of
approximately GBP434m, which will provide flexibility for
accelerated value-creating M&A across the Group.
-- GlobalData Plc will own the remaining 60% of GlobalData
Healthcare, which will continue to be a fully consolidated
subsidiary of GlobalData Plc.
-- Transaction is expected to close during Q2 2024.
Mike Danson, CEO of GlobalData, said: "This is a significant
milestone in GlobalData's evolution, and we are delighted to
welcome Inflexion as a shareholder in our Healthcare division. The
investment highlights the significant value in our unique data
platform and gives us the flexibility to launch a more ambitious
approach to growth investment across our portfolio. We believe that
we can create substantial value for all shareholders and accelerate
GlobalData's profitable growth over the coming years."
David Whileman, Partner and Head of Partnership Capital at
Inflexion, said: "GlobalData is renowned for creating data and
analytical insight for its clients across many verticals. We are
really excited about our partnership with them to carve out and
expand an independent Healthcare division. This is a tried and
tested strategy we've successfully pursued many times and another
example of Inflexion being the leading minority investment
partner."
Group Reorganisation and Investment by Inflexion
Background
Fuelled by the Growth Optimisation Plan, GlobalData Group
revenues have grown by more than 50% over the last five years, from
GBP178m in 2019 to over GBP270m expected in 2023. GlobalData now
serves more than 4,700 customers with its world class
multi-industry platform. The Group has been strategically
transformed with significant organic investment across technology
and AI, enhanced go-to-market capabilities, as well as an excellent
track record of value creating M&A.
One of the most important pillars in the Growth Optimisation
Plan is Customer Obsession. The focus has been to 1) develop a
trusted, global brand synonymous with delivering exceptional
customer value and service; 2) build a global community of engaged
industry professionals; and 3) maintain a customer-centric culture
that informs the Group's strategy, operating model, and business
decisions. The success of GlobalData's Healthcare division
highlights the tremendous growth and value opportunity from a
focused approach to Customer Obsession. Under the new growth plan,
GlobalData will elevate its customer-focused approach throughout
the group, driving value-enhancing revenue and margin
expansion.
GlobalData will host a capital markets event in Q1 2024 to
provide further detail on the new growth strategy.
Investment by Inflexion
Monument Bidco Limited (an investment vehicle wholly owned by
funds managed or advised by Inflexion Private Equity Partners LLP
("Inflexion")) has agreed to acquire a 40% minority shareholding in
Washington Topco Limited ("Topco"), a new entity established as the
holding vehicle for GlobalData's Healthcare division. GlobalData
expects to receive net cash proceeds of approximately GBP434m. The
investment by Inflexion, a leading investor in the sector,
represents a strong endorsement and provides a meaningful partner
to drive the Healthcare division's growth. The majority
shareholding of 60% in Topco will remain with GlobalData, and Topco
and its subsidiaries will continue to be fully consolidated
subsidiaries of GlobalData. The Transaction is expected to close
during Q2 2024 and is subject to regulatory clearance and
completion of the reorganisation of the Healthcare division into a
separate corporate group headed by Topco.
GlobalData Healthcare's subscription service offers a one-stop
solution for over 2,000 global customers across large global
pharma, pharma & biotech, pharma suppliers, professional
services and medical devices manufacturers. The proprietary
Intelligence Centre platform that the business has developed
provides actionable insights into trends related to drugs, trials
and therapeutic reports, supporting research and development of
pharmaceuticals, and ultimately informing business intelligence
decisions. The division generated June 2023 LTM EBITDA of GBP50m
(on a standalone basis).
The Transaction represents a compelling crystallisation of value
for shareholders, with the Group receiving a significant cash
injection to fuel growth and demonstrates the significant value of
its mission-critical data. The implied value for the Healthcare
division on a debt free, cash free basis is GBP1,115m, which
compares to a market capitalisation of GBP1,352m for the entire
Group (as at close of market on 20 December).
Following the completion of the Transaction, it is anticipated
that GlobalData's balance sheet will go from net debt of GBP230.8m
(as at 30 June 2023), equivalent to 2.3x leverage, to being
debt-free and net cash. As well as improving the profitability and
cash flow of the Group, the de-levered balance sheet allows
management additional flexibility to accelerate value-creating
M&A across the Group.
GlobalData and Inflexion have entered into a shareholders'
agreement, which will take effect from completion of the
transaction, in order to govern the relationship between them.
GlobalData will, save in very limited circumstances, have a
majority of the voting rights on the Board of Directors of
GlobalData Healthcare. Furthermore, in addition to his role as CEO
of GlobalData, Mike Danson will serve as Executive Chairman of
GlobalData Healthcare.
GlobalData and Inflexion have also agreed to certain customary
provisions in relation to minority protections, shareholder consent
rights and exit provisions, including drag rights for either
shareholder in certain circumstances (subject to a customary right
of first offer for the other shareholder).
ENQUIRIES
GlobalData Plc
0207 936
Mike Danson, Chief Executive Officer 6400
Graham Lilley, Chief Financial Officer
J.P. Morgan Cazenove (Nomad, Joint Corporate Broker 0203 493
and Sole Financial Advisor) 8000
Bill Hutchings
Mose Adigun
Alex Bruce
0207 886
Panmure Gordon (Joint Broker) 2500
Rupert Dearden
Dougie McLeod
Deutsche Numis (Joint Broker)
Nick Westlake 0207 260
Iqra Amin 1000
0203 727
FTI Consulting (Financial PR) 1000
Edward Bridges
Dwight Burden
Emma Hall
J.P. Morgan Cazenove is acting as Sole Financial Advisor to
GlobalData Plc. Reed Smith LLP is acting as legal counsel to
GlobalData.
J.P. Morgan Securities plc, which conducts its UK investment
banking activities as J.P. Morgan Cazenove ("J.P. Morgan
Cazenove"), and which is authorised in the United Kingdom by the
Prudential Regulation Authority and regulated in the United Kingdom
by the Financial Conduct Authority and the Prudential Regulation
Authority, is acting exclusively as sole financial adviser for
GlobalData Plc and no one else in connection with the Transaction
and shall not be responsible to anyone other than GlobalData Plc
for providing the protections afforded to clients of J.P. Morgan
Cazenove or its affiliates, nor for providing advice in connection
with the Transaction or any other matter referred to herein
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END
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