Acquisition
Ingenta PLC
11 March 2002
Contacts:Ingenta Website: www.ingenta.com
Mark Rowse, Chief Executive Tel: 01865 799010
David Callcott, Finance Director Tel: 01225 361020
Hudson Sandler
Alistair Mackinnon-Musson Tel: 020 7796 4133
Philip Dennis Email: ingenta@hspr.co.uk
Ingenta plc
Ingenta moves into online course pack market
with acquisition of HERON
Ingenta plc, the global market leader in the online
distribution of published scientific, professional and
academic research, is pleased to announce it has agreed to
acquire the business and assets of HERON, the UK's leading web-
based supplier of online course packs to Higher Education
Institutions in the UK. The acquisition comprises an initial
cash consideration payable to the partnership of the 3 UK
universities which operate HERON, together with a royalty
arrangement on future sales, subject to an aggregate maximum
of £260,000.
By leveraging its worldwide customer base of publishers and
libraries, there are significant opportunities for Ingenta to
develop the online course pack service which is relatively new
to the UK but rapidly growing, and to expand into other
countries which operate a similar university framework. The
Board has decided to fund this expansion through an issue of
new equity capital and the Company has placed 830,000 new
ordinary shares at 150p per share to raise £1.245 million in
cash, net of expenses.
Created by a joint initiative between Stirling, Napier and
South Bank Universities, with initial funding from the UK
Higher Education Funding Councils through the JISC, HERON
compiles and distributes online packs of course-related
material such as articles and book chapters, including
negotiating copyright approval, for use by students of Higher
Education Institutions in the UK. The institution is charged
an annual fee, as well as a transaction fee for each course
pack item distributed.
The assets acquired are expected to total at least £150,000 on
completion, based on unaudited management accounts, with sales
in the year to 31st March 2002 expected to be some £250,000,
generating gross profits of over £100,000. A preliminary
agreement has been entered into with the partnership which
owns HERON and completion is expected to occur on 31st March
2002.
Commenting on the acquisition, Mark Rowse, Chief Executive,
Ingenta plc said:
'Ingenta has been reviewing for some time the best way to
enter the market for supplying online content to the rapidly
growing higher education e-learning sector. HERON's course
pack service provides a great opportunity to do so since it is
highly complementary to Ingenta's existing services. Building
on our relationships with both libraries and publishers, our
global distribution network and our technology and content
assets, we have the opportunity to expand its activities
rapidly both in the UK and overseas. We expect HERON to be
providing a modest contribution to profits in the current year
to 30th September 2002 and these profits are expected to grow
substantially in the next couple of years. With our half year
end approaching on 31st March, it is pleasing to be able to
report that the Group is continuing to show strong turnover
and gross margin growth, with profitability remaining in line
with expectations. I look forward to HERON making a
contribution to profits in the second half of the year.'
On behalf of the HERON Partnership, Carolyn Rowlinson, Project
Director, added:
'From a largely untested idea, the service has grown rapidly,
evolving according to the needs of our members. HERON's role
in supporting universities in their efforts to widen access
and to develop innovative teaching and learning is
increasingly valued in higher education, and students are
enthusiastic about online delivery of recommended reading. We
welcome this outcome: Ingenta not only guarantees continuation
of the HERON service, but promises exciting opportunities for
development which we believe will offer real benefits to the
higher education community.'
Notes to editors
Ingenta plc (www.ingenta.com)
Ingenta is the global market leader in the management and
distribution of published scientific, professional and
academic research via the Internet, and develops and maintains
specialist websites for publishers, self-publishing societies
and libraries.
For publishers of scientific, professional and academic
periodicals, journals and reference works, Ingenta provides a
suite of publisher services including data conversion, secure
online hosting, access control and distribution services.
This research content - 12 million articles from over 5,400
online publications and 20,000 fax delivered publications - is
accessed by over 3.5 million researchers a month via
ingenta.com and other websites, making Ingenta one of the 10
largest Web service providers in the UK.
Ingenta's revenue streams derive from:
* Fees paid by customers for publisher services. (Publisher Services)
* Fees paid by customers for specialist website build and maintenance.
(Specialist Websites)
* A share of pay-per-view article purchases and website subscription
revenues. (Pay-Per-View)
HERON
The HERON (Higher Education ON-demand) project was established
in 1998 and arose from the JISC's eLib Phase 3 'project into
service' strand. It was created to offer improved access for
students to recommended study materials, using alternatives to
the traditional library provision, which has long been
regarded as inadequate to cater for innovative course
requirements and the emerging student markets. HERON now
offers a national service to the UK Higher Education community
for copyright clearance, digitisation and delivery of book
extracts and journal articles. It is also developing a
resource bank of digitised materials for rapid re-use (subject
to copyright permissions). HERON also offers its members
experience and strength in negotiations with publishers and
other rightsholders.
Websites:
www.ingenta.com
www.heron.ac.uk (Further information on HERON)
http://heron.napier.ac.uk/heronweb.html (The HERON course pack service)
http://www.jisc.ac.uk/ (Further information on the JISC -
Joint Information Systems Committee)
This information is provided by RNS
The company news service from the London Stock Exchange