REG - Elixirr Intnl PLC - Acquisition of Responsum, Inc.

Elixirr InternationalAnnouncement

18/09/2023 07:00

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RNS Number : 6650M  Elixirr International PLC  18 September 2023

ELIXIRR INTERNATIONAL PLC

("Elixirr" or the "Company")

Acquisition of Responsum, Inc.

Elixirr International plc (AIM:ELIX) (together with its subsidiaries, the
"Group"), the established, global award-winning challenger consultancy, is
pleased to announce the acquisition of the entire issued share capital and
voting rights of, Responsum, Inc. ("Responsum"), a US-headquartered firm which
has developed proprietary artificial intelligence software (the
"Acquisition").

 

Highlights

 

·   Responsum is a US-headquartered firm which has developed proprietary
Artificial Intelligence ("AI") software

·    The Group's fourth acquisition since IPO in July 2020, fifth overall,
and second in the USA - enhancing the Group's presence in this key market

·    The Acquisition brings specialist services in emerging technology,
and large language model ("LLM") and generative AI into the Group,
complementing the Group's existing service offering and iOLAP Inc.'s ("iOLAP")
data and analytics capabilities in particular

·   The global AI market is forecast to grow from US$208 billion in 2023 to
US$1.8 trillion by 2030 1  (#_ftn1) . Consequently this acquisition positions
the Group to capitalise upon the growing demand from clients for support in
understanding how to implement and benefit from AI

·     The Group has already worked closely alongside Responsum on several
client engagements prior to the acquisition, with a partnership between
Responsum and the Group announced on 3(rd) August 2023. Since then, 40+ client
opportunities have been identified, validating the opportunity

 

 

Reasons for the Acquisition

 

Responsum helps organisations realise and implement solutions using the latest
in AI, machine learning and generative AI models like GPT-4. The platform can
be used across different industries by sales teams to scale productivity,
performance and data hygiene; support teams to reduce costs and improve the
customer experience; executives and managers to streamline access to internal
data and reporting; and researchers to analyse documents and data at scale.

The Group was already working closely with Responsum prior to the acquisition
and sees a significant opportunity to offer its consulting services in
conjunction with Responsum's AI platform to its client base. Responsum's LLM
and generative AI expertise, combined with iOLAP's technology and data
capabilities together with Elixirr's strategic consulting expertise, will
enable clients to not only accelerate the adoption of the technology, but use
it in the most valuable ways. This acquisition also builds on Elixirr's
organic growth in the AI market, as evidenced by Elixirr's most recent Partner
hire, John Kalil, who brings previous experience as Chief Customer Officer at
Noodle.ai.

Responsum was co-founded by Steve Steinberg (CEO) and Adam Hofmann (Chief
Marketing Officer). Steve will continue to lead the business following the
Acquisition.

 

 

 

Consideration for the Acquisition

 

The Group acquired Responsum for a maximum enterprise value of US$7.4 million.
The maximum consideration is US$6.4 million which consists of:

 

-  Initial consideration of US$2.0m in cash;

-  Initial consideration of US$3.4m to be settled through the issue in
September 2023 of 505,196 Elixirr

    International plc Ordinary shares at a price of £5.40 per share;

-  Potential earn-out payments of up to US$1.0 million in cash which are
contingent on iOLAP Inc. and Responsum Inc. together achieving EBIT margin
targets in periods up to 31 December 2026.

 

The Ordinary Shares purchased pursuant to the Acquisition will be subject to
restrictions on sale for a total period of up to 4 years. The sellers have
also agreed 3-year restrictive covenants.

Admission and Total Voting Rights

As referred to above, as part of the consideration for the Acquisition,
Elixirr will issue 505,196 new Ordinary Shares. The new Ordinary Shares will
rank pari passu with the Company's existing issued Ordinary Shares.
Application will be made to the London Stock Exchange for 505,196 new Ordinary
Shares to be admitted to trading on AIM ("Admission") and it is expected that
Admission will become effective and trading will commence at 8.00 a.m. on
22(nd) September 2023.

After Admission, the total number of Ordinary Shares in issue will be
46,691,677 and the total number of voting rights will therefore be 46,691,677.
This figure may be used by shareholders as the denominator for the
calculations by which they will determine if they are required to notify their
interest in, or a change to their interest in, the share capital of the
Company under the FCA's Disclosure Guidance and Transparency Rules.

 

Founder & CEO of Elixirr, Stephen Newton said:

 

"Bringing Responsum on board will allow us to engage with our clients in a way
that is very differentiated in the market - combining strategy and execution
together under one roof, empowered by the tech of tomorrow. This acquisition
enables us to be anchored in a core capability but provide the wider strategic
services needed to make a real difference for our clients' organisations. This
is just one of many acquisitions we intend to make in areas that add real
value to the change journeys and value creation opportunities our clients
have."

Co-founder & CEO of Responsum, Steve Steinberg said:

 

"Generative AI presents huge opportunities for businesses. That's exactly why
we founded Responsum - to help clients unlock the power of this technology to
drive efficiency, value and creativity. As part of Elixirr, not only can we
now bring our technical expertise to a wider range of businesses across the
globe, but also strengthen our offering through the power of the Elixirr
brands. Working together over the past year I have also been able to see the
cultural alignment between our teams - an entrepreneurial drive in every
individual and a real passion for clients' success. Coming together will give
us the best possible opportunity to help more companies reach their full
potential and effect real change using AI."

Non-Executive Chairman of Elixirr, former President & Chief Strategy
Officer of Salesforce and former CEO of BT, Gavin Patterson said:

"The acquisition of Responsum demonstrates Elixirr's position as a consultancy
centred around the cutting edge technology. The potential of AI is limitless,
and emerging technology such as this will have a key impact on the consulting
industry and the evolution of services that clients will demand, providing
huge growth opportunities for Elixirr's core offering. Having the ability to
advise clients on this emerging and important market will set Elixirr up for
success and continued growth in the future."

 

For further Information please contact:

 Elixirr International plc

 Stephen Newton, CEO

 Graham Busby, CFO

 Public and Investor Relations contacts:

 investor-relations@elixirr.com

 Cavendish Capital Markets Ltd (Nominated Adviser & Joint Broker)       +44 (0) 20 7220 0500

 Christopher Raggett, Charlie Beeson (Corporate Finance),

 Sunila De Silva (ECM)

 Investec Bank plc (Joint Broker)                                       +44 (0) 20 7597 4000

 Carlton Nelson, Henry Reast (Corporate Broking)

About Elixirr International plc

Elixirr is an established global award-winning management consultancy,
challenging the larger consultancies by delivering innovative and bespoke
solutions to a repeat, globally-recognised client base.

Elixirr was founded in 2009, by Stephen Newton, Graham Busby, Ian
Ferguson, Andy Curtis and Mark Goodyear, experienced business advisors who
identified a market opportunity to provide bespoke, personal services as a
'challenger' to the traditional consultancy businesses in the
market. Elixirr guides its clients to overcome challenges such as:
future-proofing against technological disruption; development and roll-out of
innovative new propositions, products and services; incubating new businesses;
navigating a more complex and multinational regulatory environment; and
project management and implementation of major change programmes.

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic
law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the company's obligations under Article 17 of
MAR.

 

 

 1  (#_ftnref1)
 https://www.statista.com/statistics/1365145/artificial-intelligence-market-size/

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