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BRAMPTON, ON, Oct. 12, 2011 /CNW/ - The DATA Group Income Fund (TSX:DGI.UN) ("The DATA Group") today announced that one of its wholly-owned subsidiaries has entered into an agreement with WTFI Inc. to acquire all of the issued and outstanding shares of The Fulfillment Solutions Advantage Inc. ("FSA"), a Markham, Ontario based direct marketer. As a result of the acquisition of FSA, The DATA Group will also acquire a 70% interest in FSA Datalytics Canada Inc. ("Datalytics"), a provider of web based direct marketing solutions and related data analysis. The acquisition is expected to close in the fourth quarter of 2011.
FSA AND DATALYTICS
FSA provides services in the growing area of digital, direct mail, fulfillment, loyalty programs, promotional contest management and call centre services. Datalytics provides complementary personalized direct marketing through a number of integrated channels such as mobile communications, e-mail and personalized web pages and also provides database marketing services such as social media monitoring and predictive analysis of consumer data. For the twelve months ended March 31, 2011, FSA recorded revenues (including revenues from FSA's Datalytics business) of $19.4 million.
Strategic Rationale
"The DATA Group has been a "rock solid", reliable supplier for our customers' mission critical documents and marketing collateral for years. It's what we've stood for. In early 2011 we launched a new, transformational strategic plan which has three components: generating new business in our existing markets, ongoing cost reduction, and most significantly, augmenting our existing product offering with an expanded range of digital products and services in high growth categories. This acquisition accelerates the execution of our growth plan. FSA has a track record of growth, innovation and outstanding customer service. The acquisition enhances our digital, web based solutions and professional services. We look forward to working with the talented team at FSA and their customers" said Michael Suksi, President and Chief Executive Officer of The DATA Group.
Mr. Suksi added "I would like to recognize the contribution of Rob van Velzen, FSA's founder and leader until his passing earlier this year. Rob was a visionary leader who built an outstanding company with a strong management team, employees, product offering and customer base. Our deepest condolences go to Rob's family. We are committed to continuing FSA's growth as part of the DATA Group."
"The DATA Group's values, combined with their vision and ability to grow their direct marketing business and provide more value to their clients make them a good fit with FSA and Datalytics" said Jan van Velzen, owner of WTFI Inc.
Acquisition Financing
The DATA Group expects to fund the acquisition with a combination of cash in hand and drawing upon its existing credit facilities. The DATA Group does not expect that funding for the acquisition will have a material impact on its Total Debt to Adjusted EBITDA financial covenant ratio under its existing credit facilities. While specific financial terms were not disclosed, The DATA Group expects the acquisition of FSA to be immediately accretive to Adjusted EBITDA and Cash Available for Distribution (See "Non-GAAP Measures" in The Data Group's management's discussion and analysis of financial condition and results of operations for the six months ended June 30, 2011, which is available on the System for Electronic Document Analysis and retrieval (SEDAR) at www.sedar.com). The DATA Group does not intend to change the current distribution level on its outstanding units as a result of this acquisition.
About The DATA Group
The DATA Group owns directly and indirectly all of the outstanding partnership units of The Data Group Limited Partnership (the "Data Group LP") and all of the outstanding shares of the Data Group LP's general partner, Data Business Forms Limited.
The DATA Group is a leading provider of document management and marketing solutions. We provide integrated web and print based communications and information management and associated professional services. We differentiate ourselves and provide value to our customers by focusing on innovative, high value solutions and on exceptional performance at delivering on our promises and commitments. We have over 1,800 employees working from 32 locations across Canada to accomplish this.
Additional information relating to The DATA Group is available on SEDAR at www.sedar.com, www.datagroup.ca and www.datagroupincomefund.com.
Forward-looking Statements
Certain statements in this press release constitute "forward-looking" statements that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of The DATA Group and/or the Data Group LP, or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward-looking statements. When used in this press release, words such as "may", "would", "could", "will", "expect", "anticipate", "estimate", "believe", "intend", "plan", and other similar expressions are intended to identify forward-looking statements. These statements reflect The DATA Group's current views regarding future events and operating performance, are based on information currently available to The DATA Group, and speak only as of the date of this press release. These forward-looking statements involve a number of risks, uncertainties and assumptions and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such performance or results will be achieved. Many factors could cause the actual results, performance or achievements of The DATA Group and the Data Group LP to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. The principal assumptions and risks that The DATA Group made or took into account in the preparation of these forward-looking statements include the impact of the economic conditions on the Data Group LP's businesses; the risk that the DATA Group may not be successful in growing its business or in managing its organic growth; risks involved with acquisitions, including the risk of liabilities and contingencies that The DATA Group may not discover in its due diligence prior to consummation of a particular acquisition; the Data Group LP's ability to grow its sales or even maintain historical levels of its sales of product and services including printed business documents; increases in the costs of paper and other raw materials used by the Data Group LP; the Data Group LP's ability to maintain relationships with its customers; competition from competitors supplying similar products and services; and the application of recent changes to the income tax treatment of certain income trusts, such as The DATA Group, which, as of January 1, 2011, subject The DATA Group to tax. Additional factors are discussed elsewhere in this press release and under the heading "Risks and Uncertainties" in The DATA Group's management's discussion and analysis and in The DATA Group's other publicly available disclosure documents, as filed by The DATA Group on SEDAR (www.sedar.com). Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated or expected. Unless required by applicable securities law, The DATA Group does not intend and does not assume any obligation to update these forward-looking statements.