Good Afternoon,
Today: Money Supermarket & Zoopla's Acquisition but no update from Zoopla. If one didn't know better, if Uswitch are punished (indirectly Zoopla), the £10M indemnity may have been very conservative.
As per Zoopla's Statement:
The Share Purchase Agreement also provides that the Sellers will indemnify the Company against any losses, fines or costs incurred by the uSwitch Group (up to a maximum of £10 million in aggregate) as a result of the investigation by Ofgem during the period of up to three years from Completion. As security for such indemnity, £10 million of the Institutional Deferred Consideration and the Management Deferred Consideration (less any sum paid to the Company pursuant to such indemnity prior to the payment of such deferred consideration amounts) will be paid into an escrow account. Any such losses fines or costs incurred shall be paid to the Company and the balance of such amount (if any) shall be paid to the Sellers upon expiry of this indemnity.
Although the performance-based earn-out of up to £30m may be avoided if it is considered to be gross misconduct.
As per Zoopla's Statement:
Leaver provisions in the Share Purchase Agreement provide that if any of the relevant Executive Sellers or Management Sellers resigns or is dismissed for gross misconduct, that Seller shall not be entitled to receive any further payments of the Management Deferred Consideration or Earn-out Consideration.
Atb Fraser
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