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Four acquisitions provide platform to start chasing decent deals

Digital marketing buy-and-build venture Be Heard (BHRD:AIM) is starting to look very interesting now it has laid the foundations for an ambitious growth push.

Investors should accept the business may need to keep issuing new shares to raise money for acquisitions. That’s one of the key reasons why companies list on the stock market in the first place – to access capital markets. We believe equity dilution is a price worth paying given the inherent potential in the business.

Finance director and chief operating officer Robin Price says using debt to fund deals may become an option from 2018 onwards, assuming the company has reached sufficient scale by that point.

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Pillars of strength

Executive chairman Peter Scott is a veteran of the advertising industry with a successful track record. He is helping Be Heard to create an integrated digital marketing agency built around four key pillars. These are media planning/buying; design, build and user experience; creative and content; and strategy, innovation and analytics.

It has completed four deals since inception in November 2015. Be Heard has acquired media buyer Agenda21, web and app designer MMT Digital, content marketing agency Kameleon and marketing analytics outfit Freemavens. These businesses will be brought under one roof before the end of the year.

All four businesses were in Portugal in March to pitch to the world’s second largest wine producer and the quartet are already acting in concert for four clients, the largest of which is mobile telecoms giant Vodafone (VOD).

Scott says the team will only make an acquisition if the existing stable of companies would be happy to leave their clients alone with the targeted firm.

‘To be honest we take a private equity approach. For every 100 companies we get information on, 80% go in the bin. Of the remaining 20%, a further 80% go in the bin. We are very prudent and we know what we are looking for.’

Capitalising on YouTube scandal

The head of Agenda 21, Rhys Williams, says the YouTube scandal, which has seen big advertisers pull their adverts from the site after they featured alongside extremist content, is creating opportunities for the Be Heard subsidiary.

Williams explains his business can help brands get the ‘right ads, at the right time in the right environment’.

Be Heard’s full year results (30 Mar) were in line with house broker Numis’ forecasts with normalised pre-tax profit of £700,000 on revenue of £9.5m but only included a full year contribution from Agenda21. Scott’s medium-term ambition is to hit £100m of revenue.


We think Be Heard has significant potential to generate value for shareholders. Buy at 3.6p.

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