Better Collective acquires Skycon Limited for £45m
The deal will be met with £25m upfront with up to £20m in earn-outs, which are based on financial performances in the 12 months post-closing period.
The acquisition will be funded by cash and any earn-out is estimated to be at least 50% funded by the existing revenue share database.
Skycon, a British company, specialises in display advertising and paid advertising on channels that include sports media.
Better Collective will integrate Skycon into its existing paid media department and will take over the advertising company’s recurring revenue share database.
Skycon will also have its sportsbook outlook expanded, having previously only worked with one provider as well as broadening the scope of its operations for a US launch.
Through the deal, the Denmark-based affiliate will aim to redirect future new depositing customers (NDCs) to its global sportsbook agreements. The company also announced that it will utilise Skycon on the AdTech platform that it is currently building.
Jesper Søgaard, Better Collective co-founder and CEO, believes the deal is a perfect fit for the company. “We have invested heavily in growing our paid media division to reach its current significant scale, while we also have invested in moving revenues to recurring revenue share contracts,” said Søgaard.
“During the past year, our efforts have proven successful and acquiring Skycon will be highly synergistic to this journey. Skycon is a great business, which is built on Better Collective’s favoured revenue share model.
“It is a perfect fit as we can leverage our leading skill set within media buying to grow Skycon’s revenues,” the Better Collective CEO went on to add.
“We also see a clear path to further growth as the asset can be scaled across more of our business partners, into new territories and optimised with our unrivalled first party data in sports media. This acquisition will further deepen our moat.”
Upgraded financial targets
In light of the Skycon acquisition, Better Collective also updated its expected financial targets for 2023.
It now expects revenue of €305m to €315m, whereas before it sat at €290 to €300m. The affiliate also aims to achieve an EBITDA before special items of €95m to €105m, an increase of €5m from before.
The target of <2.0x for net debt to EBITDA before special items remain unchanged.