Creston plc Acquisition of The Corkery Group
Cooney Waters LLC ('Cooney/Waters'), a subsidiary of Creston plc ('Creston' or the 'Group'), the Insight and Communications Group, today announces the acquisition of 100 per cent of the share capital of The Corkery Group, a New York based full service health and medical public relations company specialising in product and issues communications for the world's leading health organisations. Total initial cash payments amounting to US$6.0 million (£3.8 million) will be payable.
As well as being immediately earnings enhancing, the acquisition of The Corkery Group strengthens the Health division and complements Cooney/Waters, the US healthcare communications specialist that was acquired by Creston last year. Following today's announcement, The Corkery Group will operate as a 100 per cent subsidiary and trading division of the Cooney/Waters Group.
Under the terms of the Cooney/Waters acquisition, Creston agreed a deferred consideration based on the future profit before interest and tax of the acquired businesses (the 'C/W Deferred Consideration'), of which Lenore Cooney was the sole beneficiary. As The Corkery Group will become a 100 per cent subsidiary of Cooney/Waters and be fully integrated with immediate effect, Lenore Cooney has agreed that David Corkery, The Corkery Group's founder, will become a named recipient of 47 per cent of any future payments made under the C/W Deferred Consideration. There are no changes to the maximum value of potential payments made under the C/W Deferred Consideration, which is capped at US$21 million.
Founded in 1998, The Corkery Group employs 25 staff and is focused on long-term relationships with a diverse mix of clients including: International agencies, US government agencies, pharmaceutical and bio-technology companies and non-profit organisations. The Corkery Group's healthcare industry expertise spans scientific, policy and product communications, media relations, digital media, executive support and crisis management. Current clients include: American Society of Clinical Oncology, Gilead Sciences and the U.S. Centers for Disease Control and Prevention.
Following the acquisition, The Corkery Group will continue to benefit from the experience and expertise of David Corkery, who will continue as a Senior Advisor. Additionally, senior members of The Corkery Group's existing management team, Karen O'Malley (President of The Corkery Group) and Greg Lugliani (Executive Vice President), will join the Cooney/Waters Group's operating board.
Through adding new clients and complementary expertise and talent to the Group, as well sharing best practice and knowhow, we believe there are many synergy benefits to be leveraged by the wider Group as a result of this acquisition. Both companies will be re-located to one central location in 2012.
For the financial year ended 31 December 2010, The Corkery Group reported revenues of US$9.9 million (£6.4 million) and a profit before taxation of US$0.3 million (£0.2 million) - pre any shareholder bonus dividends profit before tax was US$3.5 million (£2.2 million). As at 31 December 2010 The Corkery Group had reported gross assets of US$2.0 million (£1.3 million). For the nine months ending 30 September 2011, The Corkery Group had unaudited revenues of US$6.3 million (£4.0 million) and pre any shareholder bonus dividends a profit before interest and tax of $1.9 million (£1.2 million). This is a lower financial performance than the prior year, due to the company's resignation of a client in 2010.
Commenting on the acquisition, Don Elgie, Group Chief Executive of Creston plc, said: "The Corkery Group is an excellent business with a strong track record of individual account growth and an attractive client list. The Corkery Group and Cooney/Waters are well known to one another, their cultures are similar and I am confident the increased critical mass of the combined business will benefit both operations going forward."