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Creston to sell to biggest shareholder DBAY Advisers

Mid-sized UK marcoms group Creston PLC – which recently rebranded as Creston Unlimited at the operating level after its biggest agency TMW Unlimited – is being bought by investment firm DBAY Advisers. DBAY, a mysterious outfit domiciled in the Isle of Man, already owned 28 per cent.

DBAY has made an agreed offer of £75.8m, a 35 per cent premium to Wednesday’s share price. Creston made 4.5m profit in the first half of the year on flat half year revenue of £40m.

1383570345_barrie-brienPresumably it will be business as usual at Creston/Unlimited, currently led by CEO Barrie Brien (left). Customer engagement outfit TMW is its biggest business and it also owns a majority stake in Jonathan Trimble’s 18 Feet & Rising, House of Fraser’s agency. At one time the business, founded by former McCann exec Don Elgie, bought Delaney Lund Knox Warren but that was sold to Interpublic’s Lowe for £28m in 2010. Creston then moved heavily into healthcare.

£75.8m looks a good deal for shareholders (who include buyer DBAY of course). It’s about the same amount of money the founders of the much more famous adam&eveDDB are likely to pocket when its earn-out from Omnicom is completed. But Creston has a diversified client base with business from the likes of British Airways, Canon and Danone.

Keith Hunt, managing partner at Results International comments:

The news that quoted company Creston is to be acquired by DBAY Advisors is another example of a mid market marcoms group concluding that its future is better under private ownership. We had Chime deciding on a similar route in July 2015 when it agreed to a £374m takeover led by US buyout firm Providence Equity Partners.

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It’s no secret that the mid market companies in the sector are finding it hard to raise money on the quoted markets and as a result are seeing their ambitions somewhat thwarted. Also not insignificant is the sheer time and cost involved in being a quoted company.

Private ownership is an attractive option as it allows a business to focus on growth and strategy away from the public gaze.

The good news is that there is a wall of private equity money available and the PE firms are increasingly interested in the sector – either by taking companies private or investing in groups.

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