FMDAY NEWS: 11/09/04 06:21 am
BRIGHTON, UK--(MARKET WIRE)--Nov 9, 2004 -- Futuremedia Plc (NasdaqSC:FMDAY - News), a leading European e-learning solutions provider, announced today that is has signed an agreement for the acquisition of 100% of the outstanding shares in the Swedish e-learning provider Open Training.
Open Training has its head office in Stockholm with branch offices in Gothenburg and Västerås, Sweden. Its clients include many Scandinavian blue chip companies, among them Scandinavian Airlines, NCC, Pfizer, Ericsson, Kongsberg Aerospace & Defense, Saab Automobile, Volvo Trucks, and the Stockholm Stock Exchange. Currently Open Training has 15 employees, and it is not expected that there will be major changes to that number.
With core expertise in the areas of sales training, product launches, quality assurance and security, Open Training's product offering complements and broadens Futuremedia's range, thus strengthening leadership in the European market. In addition, the acquisition will provide Futuremedia with a footprint in Scandinavia, the second largest e-learning market in Europe. The Scandinavian governments were the first in Europe to implement subsidized home computing programs, opening the Scandinavian markets to Futuremedia's award-winning Learning For All(TM) offering.
Open Training's offering includes custom designed learning content, its proprietary "Learngate" Learning Management System and "Learnlab" content authoring tool, consulting and implementation services. With 2004 revenues of approximately US $2 million, Open Training has demonstrated a profitable and cash flow positive performance and is debt-free. Futuremedia has agreed to pay approximately US $2 million in cash and stock to acquire all of Open Training's shares, with an earn out provision subject to specific performance targets. In addition Futuremedia expects to issue a minimum of 300,000 options to key Open Training employees. The acquisition is subject to customary closing conditions and is expected to be completed no later than December 20, 2004.
"We are very pleased to be joining forces with Open Training, a leading Scandinavian e-learning provider, as a first milestone in our European expansion strategy. Scandinavian companies are advanced users of e-learning and the region was the first in Europe to widely adopt government subsidized home computing initiatives which have grown into a billion dollar annual market opportunity. Open Training's proven technology and quality product range adds substantial value to our current offering and provides us with the opportunity to grow our presence in Scandinavia thereby reinforcing our position as a European market leader," said Mats Johansson, Chief Executive Officer of Futuremedia. "We expect this acquisition to be accretive from Q3 of fiscal 2005, as well as having an immediate effect on our top-line growth, both of which will more than offset dilution. As we have stated in the past, Futuremedia sees itself as a consolidator in our industry, and we expect to continue to pursue opportunities such as this if and when they appear."
"It is very exciting for us to team up with an e-learning provider of Futuremedia's caliber," said Hans-Erik Eriksson, Executive Chairman and Founder of Open Training. "Our target market consists of large Scandinavian corporations which typically prefer to work with 'one-stop, preferred suppliers' that can provide fully integrated, front-to-end solutions. Becoming part of Futuremedia should allow us to substantially increase our growth rate. Our combined offering has the potential to expand our customer base and create the strongest and broadest solution in the Scandinavian market for e-learning and a valuable partner for Home Computing Initiative implementations."
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