Conchango’s board of directors is planning an organic and acquisitive growth strategy for Europe, if the planned sale of the consultancy goes ahead later this month.
The board of AIM-listed digital media group Conchango has recommended its shareholders accept a takeover offer by US technology consulting group EMC Global Services and Resource Management.
Conchango founder and joint managing director Mike Altendorf says Conchango began talks with EMC before listing on AIM in January, but decided against a trade sale at the time due to differences in direction, which have since resolved themselves.
‘We’ve always had ambitions to be big in Europe and EMC does not have a business technology consulting arm, so for us it’s a green field,’ he says. ‘We can see both organic and acquisition growth potential in Europe. We are very interested in the Benelux countries and eastern Europe is a great opportunity. Germany would be a good target but is not an easy market to break into.’
If ratified, the 23.1p per share deal values the group at £42m. A decision from shareholders is expected before the end of April.
Conchango would serve as EMC’s European arm, though Altendorf says the deal would leave the business largely autonomous. It remains to be seen if the Conchango name is retained, he says, though EMC recognises value in the Conchango brand.
The deal will not result in any staff losses at Conchango, and 20 consultants from EMC will join the business, he adds.
Conchango creative director Matthew Bagwell says growing Conchango’s interactive media and creative operations will be a core part of the group’s growth plans.