Publicly-listed Intellectual Property firm IPH Limited (IPH) has announced an agreement to acquire AJ Park’s patent attorney business, the benefit of its trade mark and legal businesses, and its associated Australian operations.

From official announcement:

Established in 1891, AJ Park is the premier New Zealand IP firm employing 205 people and operating from offices in Auckland, Wellington and Sydney. AJ Park is a full service IP firm with a substantial local client base servicing clients ranging from large multinational corporations and universities to start-up companies and entrepreneurs. AJ Park will become the first New Zealand IP firm to join a publicly listed IP group.

The total purchase consideration for the acquisition is approximately NZD66.1m (approximately AUD60.9m) adjusted for net debt and working capital adjustments, which represents 7.5x FY17 normalised EBITDA.

Completion of the acquisition remains subject to a number of conditions including completion of certain restructuring and contractual arrangements, the receipt of necessary consents and approvals from third parties, and no material adverse changes.

Key features of the acquisition are:

– Purchase consideration of NZD66.1m, being 7.5x FY17 normalised EBITDA, adjusted for net debt and working capital adjustments.
– Consideration is to be settled approximately 60% in cash and approximately 40% in new IPH shares.
-The IPH shares issued as part of the consideration will be escrowed for 2 years.
– Cash element of the transaction to be funded in USD denominated debt.
– Completion is expected by 31 October 2017.

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