Enero ready to start shopping as business finds stability with cash in the bank
Seven years after it last opened the cheque book, Enero says it is ready to re-enter the acquisition market on the back of a strong 2016 result.
Melhuish says Enero is now in good health, debt free and ready to acquire
The agency last entered the buyer’s ring in late 2009 as Photon Group when it splashed $54m on Brisbane internet marketing company Dark Blue Sea – the last of a swift series of acquisitions that proved to be the straw that broke the camel’s back.
Within weeks of the deal, CEO Matthew Bailey departed, followed by executive chairman Tim Hughes, who stepped down, and then finally, the company, abetted by the GFC, was placed in a trading halt and restructured as it realised it could no longer service its debt.
you would have thought they wouldnt repeat the mistakes that got them into trouble – buying companies to grow earnings, instead of growing it yourself is rarely a good us of shareholders money. unless you can run the acquired business better than the current owners.
this company has proven it cant manage companies with the number of loss making acquisitions and write downs it has had over the years. what guarantee do shareholders have that this round of buying spree will be any better.
by the way $37m is hardly a war chest.
Put those numbers into perspective. Enero is about the same size as the Australian arm of an average media agency
From Enero’s past experience they are excellent at small business. Buy a medium sized business, put the golden handcuffs and squeeze on it’s former owners, change its reasons for growth and turn it into a small business. But not after demonstrating cost savings by sacking people, then giving themselves bonuses for doing so.
$37.6 cash in the bank. $75m owed but never paid to the independent company owners who – perhaps naively – sold to Tim Hughes’ Photon, which has now been written off via sunset clauses. Assume the Enero board don’t believe in karma.