ENVOY GOES GLOBAL WITH STRATEGIC EUROPEAN ACQUISITION
Second Purchase This Week Drives Projected EBITDA Per Share up over 45%
Toronto, Canada. June 14, 2000 - Geoff Genovese, President and CEO of Envoy
Communications Group (NASDAQ: ECGI / TSE: ECG) today announced the company will
make its first strategic acquisition in Europe with the proposed purchase of
the UK-based, digital imaging and design firm, Gilchrist Brothers Ltd
(www.gilchrist.co.uk). The Gilchrist acquisition is set to close on June 30th
and is part of Envoy's aggressive growth strategy. The all-cash purchase of
Gilchrist marks Envoy's second proposed strategic acquisition within a week,
drives Envoy's gross margin forecast $16 million closer to the $100 million
target and provides The Watt Group with a platform for future expansion into
Europe.
Gilchrist will operate as a division of The Watt Group and will complement the
company's internationally recognized creative design services with leading-edge
digital imaging service. Gilchrist's current list of clients include Asda,
Wal-Mart's European subsidiary, Marks and Spencer, Next, Mars and France's Otor.
Gilchrist employs more than 100 highly skilled design and digital imaging
professionals in its London, Leeds and Paris offices and has been in business
for over 100 years.
"The Envoy business plan is about the convergence of technology, branding and
marketing," said Genovese. "Through strong organic growth and strategic
acquisitions, we will continue to export our integrated model to markets
throughout the world. Our goal is to build the best of breed in each of these
core disciplines within every country we operate."
"Like the Sage acquisition, the proposed purchase of Gilchrist is a great
strategic move that will bring our 12-month rolling gross margin to over
$83 million and will increase our EBITDA per share run-rate from 53 to 77
cents," said Joe Leeder, Envoy's CFO.
"Gilchrist has brand equity in the European marketplace, and a strong client
roster. It is a good fit with The Watt Group," said Don Watt, Chairman of The
Watt Group. "The combination of our respective talents will enhance Watt's
ability to help a growing list of global clients create, develop and manage
their brands."
The Watt Group (www.wattgroup.com) is the largest strategic retail design
group in the world. For the past thirty years Watt has applied its
strategies to drive client profitability in more than two dozen industries,
spanning 35 countries. The Watt Group has developed some of the worlds most
recognized brands, including: Loblaws' President's Choice; Wal-Mart's Sam's
American Choice and Great Value brands; the Safeway Select brand and
PETsMART's Grreat Choice. Watt has also created landmark retail concepts
like The Home Depot and provided national brand consulting services for
companies like Kraft, Parmalat, Bell Canada, Borden Foods, GE, Maple Leaf
Foods, Shell Oil, Bank of Montreal and CIBC.
A new breed company, Envoy (www.envoy.to) is an integrated e-Marketer,
digitally driven and committed to building global brands both off and
on-line. In addition to The Watt Group, Envoy owns leading advertising and
e-Marketing agencies, Communique, Devlin Applied Design, FUSIONcreative and
Hampel/Stefanides of New York. Envoy's roster of clients include:
adidas-Salomon Canada, Aer Lingus, Alliance Atlantis, BASF, Benjamin Moore,
Bermuda Telephone, Bridgestone/Firestone,Canada Life, Castrol, CDNOW,
FedEx, Fisherman's Friend, Honda, Hummingbird, IMAX, Juno Online Services,
LCBO, MAC Cosmetics, National Discount Brokers, Oxford Properties,
PhoneFree, Procurenet.com, Safeway, Sprint Canada, Steelcase, Taylor Made,
Toshiba Canada and Toshiba America.
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Corporate Investor Relations: Jason Mandel [email protected]
(416) 599-2256,
Investor Relations Group: 1-800-444-9214 [email protected]
Media Relations: Darren Karasiuk, [email protected]
(416) 593-7555 ext.505
