Buongiorno Splits Off B2B Division - Sells Majority Stake
Italian mobile content supplier, Buongiorno has announced plans to split off the majority of its Business to Business services into a separate a company, and has sold a majority stake in the new company to the private equity group, Francisco Partners.
The new company, which will be independently managed, will have a 60/40
ownership. Buongiorno, however, will retain certain content-driven B2B businesses which have a business model similar to its direct to consumer business.
"We took a first step in the direction of specializing our B2C and B2B approach at the beginning of 2010, when we moved to a divisional organization" said Andrea Casalini, CEO of Buongiorno. "Today we take a further, bolder step: creating and managing the 2 separate entities will align the organizations more effectively to achieve the ambitious growth objectives each has been set. It will also give the best professional opportunity in both areas of our management team and staff. "
The new company will also buy out Mitsui's stake in two of its subsidiaries for EUR23 million giving it sole ownership of the subsidiary companies. With a 5.2% stake in Buongiorno, Mitsui is the Group's second largest shareholder and is expected to remain a long-term partner of Buongiorno.
Within this transaction, 100% of the New Company is valued at 110 million
Euro. In 2010, its pro-forma revenues were approximately 50 million Euro and a
consolidated EBITDA3 of approximately 8 million Euro.
Upon completion, Buongiorno will receive 40% stake in the New Company in the form of ordinary shares; EUR 44 million in cash (EUR 23 million of which will be paid to Mitsui) and a further EUR 36.7 million as deferred payment.
Buongiorno will also have an option to buy an additional 10% of the new company, so that both shareholders will have equal ownership.