Creston to acquire Cooney/Waters businesses

Creston has announced that it has entered into a conditional agreement to acquire substantially all of the assets and liabilities of the Cooney/Waters businesses for a cash-only consideration of up to £19.5m ($30.8m).

The Cooney/Waters businesses, based in New York City, include the healthcare PR business Cooney/Waters and the healthcare advocacy business Alembic Health Communications. The acquisition is conditional upon the approval of Creston shareholders.

The £19.5m is to consist of £5.9m payable on closing and an additional earn-out consideration of up to a maximum of £13.5m payable in two instalments based on the average earnings before interest and tax of the Cooney/Waters businesses for the period from closing to March 31, 2013 and March 31, 2015.

The initial payment is to be funded from existing bank facilities, with future earn-out payments being funded by the enlarged group's future operating cash flows.

It is believed the acquisition will:
• Enable the companies to share knowledge of and expertise on their respective markets in the US and UK
• Provide the necessary scale required to compete more effectively for larger global briefs in healthcare communications
• Increase the profile of Creston Health in a consolidating industry where fewer, larger clients require both tailored, local solutions and global reach from their consultancies
• Create a stronger competitive advantage for Creston Health, leading to an increased level of new business opportunities and lead generation.

Don Elgie, CEO of Creston said: "Cooney/Waters' strong cultural and strategic fit with Red Door, our UK healthcare PR firm, will enable seamless integration with Creston, which will open new opportunities for growth in the US and Europe."

Leonore Cooney, founder and chairman of Cooney/Waters agreed: "This important step builds on our successful two-year affiliation with Creston's Red Door Communications and offer synergistic and operational benefits for both Cooney/Waters and Creston."