K3 Capital Group PLC Joint Venture Agreement

TIDMK3C

K3 Capital Group PLC

30 November 2020

K3 CAPITAL GROUP PLC

("K3", the "Company" and including its subsidiaries the "Group")

Joint Venture Agreement

K3 Capital Group plc, a multi-disciplinary professional services firm providing advisory services to SMEs, is pleased to announce that it has entered into a joint venture arrangement to further expand its business services offering to SMEs, with further detail set out below.

K3 embarked on an acquisition strategy in 2020 which resulted in the successful acquisitions of randd and Quantuma. As part of that process, the Company employed Stephen Crossley, an experienced specialist recruiter and head-hunter to 'market map' both the niche tax and the corporate recovery markets so that they could identify and make contact with the most appropriate targets. The Company was so impressed with the service received and how effectively it unearthed the acquisition targets that K3 has now invested in a joint venture with Stephen Crossley and set up a new company Market Mapping Limited ("Market Mapping") to provide this service for UK, overseas and private equity companies looking to make off-market acquisitions in the UK SME market. Under the terms of the agreement K3 will own 40% of Market Mapping's issued share capital with an option to acquire the remaining 60% on 31 May 2024. Consideration for 40% of Market Mapping's issued share capital will be determined by certain financial performance hurdles as at 31 May 2024 and the balance of 20% payable by way of an earn out, also based on achieving certain financial performance over the three years ending 31 May 2025, 2026 and 2027. The 60% consideration, should the option be exercised, shall be payable through a mixture of cash and shares in the Company. Market Mapping commenced trading this month and has already secured its first assignment with a public company.

Furthermore, the Company has been notified that Mike Keyse, founder of randd, purchased a further 149,535 ordinary shares of 1 penny each in the Company, taking his total beneficial interest to 921,850 shares (representing 1.3% of the Company's current issued share capital), demonstrating his confidence in the strategy of the enlarged Group.

John Rigby, K3's CEO, commented,

"We received a very impressive service from Steve Crossley at the time of the randd and Quantuma acquisitions and were cognisant of the benefit this service would have to our wider client base and other PLC's, Corporates, PE Houses and Family Offices. We are delighted that Steve has agreed to work with us in developing the Market Mapping business through this joint venture arrangement. This joint venture reinforces our strategy to build a wider group of growing and complementary professional services businesses to UK SME's and we believe there will be significant opportunities to cross sell this service into our various business divisions."

For further information, please contact:

 
  K3 Capital Group plc                          Tel: c/o finnCap 020 7220 
                                                 0500 
  John Rigby, Chief Executive Officer           www.k3capitalgroupplc.com 
  Andrew Melbourne, Chief Financial Officer 
 
  finnCap Ltd (Nominated Adviser and Broker)    Tel: [phone] 
  Jonny Franklin-Adams, Emily Watts, Charlie Beeson (Corporate 
   Finance) 
  Tim Redfern, Richard Chambers (Corporate 
   Broking) 
 

About K3 Capital

K3 Capital Group plc is a multi-disciplinary professional services firm providing advisory services to SMEs, with operations throughout the UK and overseas.

Services provided by KBS Corporate, KBS Corporate Finance, Knightsbridge and KBS Capital Markets:

-- Mergers and Acquisitions (M&A) - Company sales, brokerage and corporate finance services to SME's looking to achieve full or partial exit, advising on sales to private, trade, plc, private equity or overseas acquirors. Strategic advisory and valuations, financial due diligence and debt advisory.

Services provided by RandD UK Limited:

-- Research & Development tax credit advisory: advising clients on Research and Development Tax Credit (RDTC) claims.

Services provided by Quantuma Advisory Limited:

-- Restructuring advisory: formal insolvency appointments, informal restructuring advisory, personal insolvency and pension restructuring and insolvency advice.

-- Financial advisory: comprehensive analysis of business performance through business toolkit, independent reviews, stakeholder management and turnaround and interim support.

   --           Creditor Services: creditor representation and liquidations. 

-- Forensic accounting and expert witness: forensic investigations, intelligence and forensic accounting.

-- Pensions advisory: corporate and trustee advisory, pension scheme restructuring advisory, covenant advisory and expert witness.

The Group's medium-term strategy is to build a wider group of growing and complementary professional services businesses to provide SME's with high quality advice across specialist disciplines.

K3 Capital Group trades on the London Stock Exchange (AIM: K3C.L), having listed on 11 April 2017. Please visit

  www.k3capitalgroupplc.com   for more information. 

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November 30, 2020 02:00 ET (07:00 GMT)