Ackroo Inc (TSX-V: AKR), an Ottawa-based gift card and loyalty marketing technology and services provider, has secured a $4 million debt facility from BDC Capital.
The facility’s proceeds will be used for acquisitions.
They include Ackroo’s acquisition of certain assets of I.Q. 7/24 Inc, the digital marketing and business intelligence business of Mobi724 Global Solutions Inc. The $2.7 million deal is expected to close next month.
Founded in 2012, Ackroo provides its in-store and online automated marketing solution to automotive, petroleum, hospitality and retail merchants.
Ackroo secures $4 million debt facility from BDC Capital & confirms closing date of the acquisition of IQ724 from Mobi724
Ackroo secures M&A capital from Business Development Canada Capital (BDC)
OTTAWA, June 21, 2019 (GLOBE NEWSWIRE) — Ackroo Inc. (TSX-V: AKR; OTC: AKRFF) (the “Company”), a gift card, and loyalty marketing technology and services provider is pleased to announce it has secured $4,000,000 via BDC Capital. Under the terms of the loan, Ackroo will receive an initial tranche of $3,000,000 on closing plus access to an additional $1,000,000 disbursed should the Company identify another acquisition where these additional funds can be leveraged. The loan:
Bears a 9.75% interest rate while EBITDA is under $750k per year and will reduce to a low of 7.5% once audited EBITDA is in excess of $1,100,000 per year
Requires no principal payments to be made until April 2021 and will be done in the form of an annual excess cash flow sweep.
Includes a 2.55% annual royalty on clients acquired with the facility during the term of the loan, excluding the first year.
Includes a 0.5% bonus on sale or change of control payment to be made to BDC Capital should the company sell the business during the term of the loan
Includes a 1.5% processing fee of the value of the facility (as the funds are tranched) plus $100 a month financing management fee
In connection with the debt financing the Company also announces it will close on the acquisition of IQ724 from Mobi724 with the proceeds from this debt facility on July 2nd, 2019.
“Establishing a growing relationship with lenders like BDC Capital is a key priority for Ackroo,” commented Steve Levely, Chief Executive Officer of Ackroo. “As we look to continue down our inorganic growth path having access to debt facilities like this one affords us the ability to continue to grow in a material way while reducing potential dilution to our shareholders. These funds will immediately go to work to close on our acquisition of IQ724 from Mobi724 and in turn will help add a significant amount of positive EBITDA to the Company. The partnership aligns perfectly with our goals to continue to simplify, consolidate and improve the merchant marketing landscape while keeping the best interest of the Company and our shareholders in mind. ”
About BDC Capital
BDC Capital is the investment arm of BDC – Canada’s only bank devoted exclusively to entrepreneurs. With $3 billion under management, BDC Capital serves as a strategic partner to the country’s most innovative firms. It offers a full spectrum of risk capital, from seed investments to transition capital, supporting Canadian entrepreneurs who wish to scale their businesses into global champions. Visit bdc.ca/capital.
Ackroo provides merchants of all sizes a robust, cloud based multi-currency marketing platform to help attract, engage and grow their customers while increasing their revenues and margins. Through a SaaS based business model Ackroo provides an in-store and online automated solution to help merchants process gift card, loyalty and promotional transactions at the point of sale, provide key administrative and marketing data, and to allow customers to access and manage their gift card and loyalty accounts. Ackroo also provides important marketing services to assist their merchants with utilizing Ackroo’s technology solution. Ackroo is headquartered in Ottawa, Canada. For more information, visit: www.ackroo.com.
For information, please contact:
Chief Executive Officer | Ackroo
Tel: 613-599-2396 x730