Watershed<\/a>, which has developed a SaaS based learning analytics service to fully ascertain the impact and effectiveness of learning programmes.
\nGathering learning data and in turn utilising this data to create more effective learning experiences and tangible business results, is the next significant advance for the learning industry and Watershed is at the forefront of this development.<\/p>\nTim Martin will remain the CEO of Rustici under LTG\u2019s ownership and Mike Rustici will focus exclusively on Watershed to accelerate the development of this young, high growth business.<\/p>\n
Highlights<\/h3>\n
\u2022 Rustici 4 year revenue CAGR of 41% underpinned by c. 80% recurring revenue<\/p>\n
\u2022 Increases the Group\u2019s scale, capability and credibility as an international, multi-service
\ne-learning business<\/p>\n
\u2022 Significant growth opportunities for Rustici and existing LTG businesses driven by the benefits from the addition of this capability within the Group<\/p>\n
\u2022 The Rustici acquisition will be immediately and substantially earnings enhancing\/accretive<\/p>\n
\u2022 Watershed investment places LTG at the forefront of creating and utilising \u2018big data\u2019 to develop pioneering e-learning content and systems<\/p>\n
In the year ended 31 December 2015, Rustici generated unaudited revenue of USD6.6 million and EBITDA of USD2.7 million, with c. 80% of its revenue in recurring subscription fees, derived from products such as SCORM Engine which enables e-learning content to communicate securely with learning platforms, an essential requirement for the entire e-learning industry.<\/p>\n
Consideration<\/h3>\n
The consideration for Rustici comprises an initial payment of USD26 million of which USD20 million will be paid in cash and USD6 million in new LTG shares, issued at a price of 29.19 pence per share. Cash consideration will be adjusted to take account of surplus cash of USD0.5 million in Rustici at completion. Further performance based payments, capped at USD11 million, are payable to the Rustici vendors and key employees based on ambitious revenue growth targets in each of the years ending 31 December 2016, 2017 and 2018, payable with up to 25% in new LTG shares at the option of the Company, and the remainder in cash.<\/p>\n
LTG will invest USD3 million in Watershed for a 30% equity stake. This stake is prior to a further investment by Launch Tennessee, a public-private partnership focused on supporting the development of high-growth companies in Tennessee, of USD1 million, the effect of which will be to subsequently reduce LTG\u2019s equity stake to 27.27%.<\/p>\n
The transactions will be part funded by a USD20 million term loan. The loan is amortised over 5 years, repayable in quarterly instalments with a final bullet payment in January 2019.<\/p>\n
Jonathan Satchell, Chief Executive of LTG, commented:<\/p>\n
\u201cConsistent with our strategy of establishing an international full-spectrum e-learning business, acquiring Rustici, the global market leader in SCORM conformance, firmly places LTG at the heart of the e-learning industry. Further, our investment in Watershed positions LTG in the vanguard of the industry\u2019s future standard, xAPI. This will provide the Group with invaluable insights and a competitive advantage on a platform that will have a profound and long-lasting impact on the digital learning industry.\u201d<\/p>\n
Read the full RNS<\/a> here.<\/p>","protected":false},"excerpt":{"rendered":"LTG has conditionally agreed to acquire the entire issued share capital of Rustici Software LLC, the global market leader in digital learning interoperability, for an…<\/p>\n","protected":false},"author":17,"featured_media":645,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-641","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/posts\/641"}],"collection":[{"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/comments?post=641"}],"version-history":[{"count":0,"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/posts\/641\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/media\/645"}],"wp:attachment":[{"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/media?parent=641"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/categories?post=641"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ltgplc.com\/wp-json\/wp\/v2\/tags?post=641"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}