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Publicerat: 2021-01-29 18:02:32

24SevenOffice Scandinavia AB: 24SevenOffice expands its international scope by acquiring a US business and IPR for EU/UK

INSIDE INFORMATION: 24SevenOffice Scandinavia AB ("24SevenOffice" or the "Company") has entered into an agreement to acquire 94.5% of 24SevenOffice US Inc and 51% of Masterplan Inc and all the European IPR to the 24SevenOffice platform from R-Venture AS (the "Transaction"). The consideration paid in the Transaction amounts to SEK 200 million. The consideration will be SEK 170 million in cash and SEK 30 million in 24SevenOffice shares. The Transaction is expected to be completed during Q1 2021 provided that all conditions are fulfilled, including due diligence and approval from the shareholders of the Company of the purchase of the European IPR from R-Venture AS.

Background and rationale for the Transaction

The North American operation consists of 24SevenOffice US Inc and Masterplan Inc. (together referred to as "24SevenOffice US").

24SevenOffice US has completely adapted the 24SevenOffice software to the US legislation and accounting principles. Masterplan has developed one of the most comprehensive SaaS/Cloud-based Production/MRP/Inventory systems on the market today. This is new functionality for 24SevenOffice and will open a new and large market niche.

Few, if any, European cloud-based ERP systems can offer such a powerful integrated production handling system. This enables 24SevenOffice a unique offering in the Scandinavian market and provides 24SevenOffice with a team of domain knowledge of the production industry. The transaction as such also improves the competitive strength in the Scandinavian market.

24SevenOffice becomes the first listed transatlantic and multinational cloud-based ERP powerhouse in Scandinavia. 24SevenOffice US is expected to have revenues above USD 1.5 million in 2021 with an excellent customer base and a growth rate well in excess of 50%. In 2020 revenues were USD 1 million and the companies are close to cash neutral in their operations.

The 24SevenOffice software is distinguished from competitors as the software can be easily adapted to other national markets with its national accounting rules, tax codes and national accounting standards. Whereas 24SevenOffice has traditionally had the Nordic countries as the sole target market, an increased focus on M&A growth also opens opportunities in the rest of Europe. The company has therefore decided to acquire the European and UK IPR to the 24SevenOffice platform from R-Venture AS. This secures the potential for a larger market for organic international expansion and increases the scope of potential acquisition targets substantially.

24SevenOffice will thereby own and control unlimited and exclusive intellectual property rights for the 24SevenOffice technology for Europe and North America.

Staale Risa, the CEO of 24SevenOffice, comments: "We’re very excited to consolidate the 24SevenOffice platform and be able to expand outside the Nordic region. The North American business is already well established and is growing very fast with exciting clients, and we also see important synergies with our existing business. The European IPR opens up a much larger marketplace for our solutions and enables us to pursue an accretive M&A strategy."

Terms of the Transaction

The Company has entered into an agreement to acquire the European IPR to the 24SevenOffice platform and 24SevenOffice US Inc and Masterplan Inc. The consideration paid in the Transaction amounts to a total of SEK 200 million. R-Venture AS will be paid in cash for the IPR and the founders of the US operation will receive cash and SEK 30 million in 24SevenOffice shares.

To secure continued motivation and dedication for the US team the Company has agreed to acquire 94.5% of 24SevenOffice US Inc and 51% of Masterplan Inc that is 100% integrated with 24SevenOffice ERP. 24SevenOffice has also secured an option to acquire 100% of 24SevenOffice US Inc and Masterplan Inc within 3 years based on growth and ARR levels delivered by the companies, and the consideration may amount to up to SEK 30 million if all earnout conditions are met.

The Transaction is expected to be completed during Q1 2021 provided that all conditions are fulfilled, including satisfactory due diligence in the sole discretion of the board in 24SevenOffice and approval from the shareholders of the Company of the purchase the European IPR from R-Ventures AS. The notice to general meeting will be announced separately with the general meeting to be held in connection with closing of the Transaction.

The Transaction agreements have been made in accordance with prevailing corporate governance recommendations and proper arm’s length principles. Pareto Securities AS has been advising the company in connection with the Transactions.

Upon, or following, completion of the Transaction, the board of directors of the Company will propose a change of the Company's name to 24SevenOffice AB. Such change of name will be subject to the decision of the shareholders’ meeting.

Responsible party

This information constitutes inside information that 24SevenOffice Scandinavia AB is obliged to make public in accordance with the (EU) Market Abuse Regulation 596/2014. The information in this press release has been made public through the agency of the responsible person set out below for publication at the time stated by 24SevenOffice Scandinavia AB’s news distributor Cision at the publication of this press release.

For further information please contact:

Ståle Risa, CEO

Tel: +46 70-023 63 03, str@24sevenoffice.com

24SevenOffice in brief

24SevenOffice's vision is to empower businesses for the future, through delivering world class cloud based business systems to small and medium-sized companies. The system is currently used by 56,000 companies in the Nordic region, with PwC and KPMG, among others, as accounting partners. The business system is module-based, where the modules are provided independently or packaged as complete solutions. For more information see www.24sevenoffice.com

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