Acquisition of rugby player management business in South Africa

Essentially Group Limited ("Essentially" or the "Group"), the AIM listed full service sports marketing, media, management and professional services Group, today announces that it has acquired the management contracts and management team of 40 South African rugby players (the "Acquisition").

About the Acquisition

Essentially’s South African subsidiary ("Essentially South Africa") is currently the sole contracted commercial advisor to the South African Rugby Players Association ("SARPA"). The Acquisition compliments its existing rugby client base by adding the management contracts and management team of 40 rugby players, including current South African international rugby union players ("Springboks") Victor Matfield, Juanne Smith, Francois Steyn, Johann Muller, Albert van der Berg, Bismarck du Plessis, Heinrich Brussow, Jannie du Plessis and six further South African players playing internationally including CJ van der Linde at Leinster, all adding to Essentially South Africa’s current roster of leading South African players. 

All of the client players managed by Essentially South Africa are forward contracted for at least one season and most for more than two seasons. This gives great visibility to the business consistent with Essentially’s aims in this area, but also gives the Group a presence with size and quality in South Africa and further strengthens Essentially’s leading position in rugby and cricket, both sports which are rapidly developing commercially. 

Stephan Weyers and Gerrie Swart, the two qualified sports lawyers who originally established and managed the players, will head up Essentially’s rugby and cricket athlete management business in South Africa, a role that they historically performed part time whilst practising as sports lawyers.

Consideration for the Acquisition

The total consideration is 4m South African Rand (approximately £258,000) paid in full on completion. The consideration is to be settled as to ZAR 3m in cash and ZAR 1m in new ordinary shares in Essentially Group ("Ordinary Shares") at 9.2p. The total consideration is 4x warranted EBIT and will be immediately earnings enhancing to shareholders of Essentially. Furthermore, the Group will gain the added benefit of international placement income staying within the Group allowing Essentially to gain further critical mass in professional rugby. 

Application has been made for 701,262 Ordinary Shares to be admitted to trading on AIM, which is expected to commence on Tuesday 11 November 2008.

Commenting on the acquisition, Bart Campbell, CEO of Essentially, said:

"We are delighted to welcome Stephan and Gerrie to Essentially. Their experience, expertise and knowledge of the industry in South Africa will be invaluable to the Group going forward. The acquisition is timely in view of the British Lions Tour in 2009 for which we are the exclusive commercial agency and further underpins Essentially’s strategy of providing a broad range of services to our clients in our core sports. The acquisition of the management contracts and team gives us further presence in a proud sporting nation and, with the help of Stephan and Gerrie, we look forward to growing the business rapidly and profitably over the coming years." 

Stephan Weyers, Director of Essentially SA, commented:

"We are delighted to become a part of Essentially and provide our clients with the Group’s unrivalled global reach in rugby union.  South Africa will be at the heart of some of the leading sporting events over the coming 2 to 3 years and we believe it is key to have access to Essentially’s services and global reach. This transaction catapults our business to the next level and we look forward to working with Bart and his team to execute on the significant number of opportunities in South African sport."

For further information please visit http://www.essentiallygroup.com  or contact:

Essentially Group Limited	Buchanan Communications	Cenkos Securities
Bart Campbell, Group CEO	Bobby Morse	Beth McKiernan
Tel: +44 (0)20 7820 7000	Christian Goodbody Ben Romney	Tel: +44 (0)20 7397 8927
	Tel: +44 (0)20 7466 5000

 

Notes to Editors:

 

About Essentially

Essentially is listed on AIM (RIC: ESN) and is a leading independent sports marketing, media, management and services agency.  The business is split into three divisions: sports marketing comprising rights sales, consultancy and events management; athlete management; and professional services which includes tax, image rights and other related services. Strong and focussed positioning in its core sports of expertise including rugby union (clients include the 2009 British and Irish Lions, the Magners League, Rugby World Cup 7’s 2009, Welsh Rugby Union) and cricket (clients include all Test Match Grounds, MCC, the Professional Cricketers Association) provide a strategic platform for growth and market expertise.  Essentially also enjoys a strong reputation in Formula One motorsport working for and with the ING Renault team and Red Bull racing.