Digital agency sells £6m-turnover arm as losses widen
Jaywing, the data science-led digital agency, consultancy and technology business listed on the AIM market of the London Stock Exchange, has agreed to dispose of its contact centre business.
The company has changed contracts to sell HSM Ltd to Bidco, a business backed by New York and London-based private equity firm Aquiline Capital Partners.
The deal follows a “competitive sales process involving several interested parties”. The business is being sold on a cash free, debt free basis and Jaywing will receive £500,000.
“The disposal of our contact centre business is an important non-core asset disposal, which will allow management to concentrate entirely on developing the core business and simplify the Jaywing offering,” said Jaywing CEO Rob Shaw.
“I’d like to thank the staff at HSM for their professionalism and look forward to working with Bidco to help make their new venture a big success.”
→ READ MORE: Digital agency Jaywing hails £2m client wins
The sale has been announced alongside Jaywing’s financial results for the six months to 30 September 2018. Pre-tax losses widened from £309,000 to £743,000 as revenue for the period fell from £23.5 million to almost £22 million.
However, chairman Martin Boddy hailed Jaywing’s “solid progress” during the six-month periood.
“Following the disposal, we will operate as a consultancy, an agency and a technology business all under-pinned by data science,” he added.
“Our skill is to combine these to create solutions that our clients find indispensable. We call this our “One Jaywing” model, a model which is now being utilised with over two thirds of our top 50 clients.”
Boddy went on to say that Jaywing is seeing momentum build quarter on quarter this year, particularly in the group’s performance marketing division, Epiphany.
With the disposal process of HSM now complete, Jaywing’s management plans to focus on driving up the profitability of the core business and “exiting the year in a strong position with good momentum”.
The sale is expected to complete once Bidco obtains consent from the Financial Conduct Authority (FCA) regarding the change of control, which is expected to be within 30 working days.
Jaywing has recently announced a restructure of its martech division, Jaywing Intelligence, which sees managing director Alex Craven leave the company.
The firm said at the time that the move will enable closer alignment with Jaywing’s other Artificial Intelligence (AI) propositions.
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