London-listed cash shell Electric Guitar LON:ELEG has agreed final terms for the acquisition of 3radical, a marketing technology company that specialises in consumer data acquisition and audience engagement solutions. The deal is being valued at GBP 1.28m. This will be satisfied via the listing of 61.18m ordinary shares.
Electric Guitar originally announced the deal in July 2023. Electric Guitar was one of the few remaining, small cash shells listed in London that had yet to initiative a reverse takeover. The SPAC said that the transaction was in line with the acquisition strategy it had set out last year.
3radical has created and proven a Software as a Service (SaaS) platform which allows individuals and organisations to engage individuals and request their data directly using progressive and interactive digital experiences, at scale. Its platform, called 3radical Voco, can be critical for marketing as well as helping companies to optimise their communications, design products and services, and drive revenue.
“We believe that 3radical’s sophisticated customer engagement and first-party data technology align perfectly with our strategy to acquire businesses that help marketers maximise the value of first-party data,” said John Regan, CEO of Electric Guitar.
3radical well positioned to capitalise
3radical Voco is already being used by some major brands in the UK, US and Asia Pacific markets. It looks well-positioned to capitalise on the shifts within this sector that are being driven by data legislation, consumer sentiment and technology changes. This means that brands and businesses needs to acquire data themselves rather than purchase it from third parties, or relying on cookies.
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“With the current shift in the structure of the online marketing and advertising industry towards first-party data solutions, we believe that the enlarged group is in a strong position to capitalise on this trend and enhance shareholder value,” said David Eldridge, Chairman of 3radical.
Electric Guitar said that £1.32m was being raised through a placing and subscription at 2.1p per share. The company will apply for admission to AIM and will cancel its existing shares from the standard segment of the official list and trading on the main market of the London Stock Exchange. Trading should commence on 3 May.
Directors and management of the company will own approximately 12% of the issued shares.
Electric Guitar seeking shareholder approval
Electric Guitar’s strategy, as outlined at the time of its admission to the standard segment of the official list, is to seek acquisitions in the digital media sector and to act as a consolidator and operator in the digital marketing and advertising market, focused principally on first party data solutions.
Management said they believe that the acquisition represents “a significant opportunity” as it not only aligns with Electric Guitar’s stated strategy, but also brings a quality product, management team and business which the existing directors believe provides significant growth potential.
Investors should note that should the proposed acquisition not be approved by shareholders, shares in Electric Guitar will continue to be admitted to the official list and the main market. In such an event, proposals will be put to shareholders as to the continuation and future strategy of the company. The deadline for proxy votes is 29 April.
