itemus to merge with Digital 4Sight
Tobin and Tapscott teams combine visions to form unique end-to-end
digital economy solutions provider
TORONTO, Dec. 18 /CNW/ - itemus inc. (TSE:ITM, OTCBB:ITMUF) announced
today a plan to merge with privately held Digital 4Sight Corporation, one of
the world's leading digital economy consulting and research firms. The result
is a combined company with a unique focus on corporate transformation for
global organizations -- improving their competitive edge by creating "business
webs" ("b-webs").
This stock-based transaction is valued at US $22 million, representing 56
million common shares of itemus, and includes a US$2 million payment for
working capital, as well as a convertibility option that provides for up to
US$3.3 million worth of shares to be paid out in cash over 24 months, subject
to certain conditions. Digital 4Sight employs approximately sixty full time
staff, has a strong record of profitability and an enviable blue-chip client
base. The organization has trailing 12-month revenue of approximately US$9
million with historic year-over-year growth in excess of 100%. It has
estimated 2001 revenues from research and consulting services of US $13
million, with corresponding operating and net margins comparable to the top
performing global consulting firms.
"This is the next milestone in the execution of our business plan," said
Jim Tobin, itemus President and CEO. "Digital 4Sight has grown a profitable
business providing e-business know-how to the most senior executive levels in
the Fortune 500. Digital 4Sight's people and methods complement itemus,
further sharpening our operational focus to complete the picture on the back
of our pending acquisition of Shooting Gallery." The combined operations
include a trailing annual revenue base of over US $35 million, highly skilled
employees in six cities in Canada and the US, and a clear path to
profitability. "itemus is now revealed as a new breed architect with the
ability to offer end-to-end business web capabilities to global
organizations," Tobin added.
"Business web" describes the new corporate form for the post dot-com
world: an organizational model that is supplanting vertically integrated
corporate structures as all industries adopt network-based models. According
to Jupiter Research, online B2B trade will experience astounding growth over
the next five years, rising to $6.3 trillion in 2005. In this market, success
will depend on the strength of a company's network of market partnerships,
linked together via the Internet to enhance customer and shareholder value. In
every sector, business webs enable companies to innovate, produce and compete
more effectively than traditional vertically integrated corporations.
"Of all the new economy innovators we know, itemus has the most complete
vision, closest thinking and values to our own," said Digital 4Sight Chairman
Don Tapscott. "Having followed their development from inception, it became
obvious to all of us that our mutual clients need a single provider for both
strategy and implementation of b-webs. Together we can create an e-business
powerhouse and lead the evolution of the new model of corporations - becoming
the preeminent builder of business webs, with the ability to engage at every
stage of need: from strategic counsel to full solutions implementation."
Under the terms of the agreement, two members of the Digital 4Sight
executive team - Chairman Don Tapscott and CEO David Ticoll - will be
nominated to a restructured itemus board of directors. Tapscott will be
nominated to become Chairman of itemus, succeeding Ian Telfer who will become
Vice-Chairman. The management, structure and brand of Digital 4Sight will
remain intact with particular attention paid to preserve the creativity,
thought leadership and independence of the company's research operation.
Additionally, a draw down notice has been delivered by itemus to raise
C$5,000,000 by issuing common shares upon the exercise of previously issued
subscription rights. The closing is scheduled to occur on December 22, 2000.
A conference call to discuss this announcement has been arranged for
5:00pm EST, December 18, 2000. Investors and analysts wishing to ask questions
of the itemus and Digital 4Sight management team should dial: 1-800-375-9259
and ask for the itemus conference call.
About Digital 4Sight
Digital 4Sight is an e-business strategy consulting firm and research
center, which works with clients to develop innovative business models for the
digital economy. Digital 4Sight also designs and assembles b-webs, culture
change services, digital supply chain and e-marketing strategies. Business
webs were first defined by Digital 4Sight and described in Digital Capital, a
Harvard Business School Press best-selling book by company co-founders Don
Tapscott, David Ticoll and Alex Lowy. Digital 4Sight's client list includes
General Motors, Hewlett-Packard, i2, IBM, Nortel Networks, Procter & Gamble,
Shell, Merrill Lynch, and the governments of Canada, Singapore, the United
Kingdom, and the United States. Founded in 1994 as Alliance for Converging
Technologies, the company has its headquarters in Toronto. Further information
is available at: www.digital4sight.com
About itemus
itemus inc. is a leading architect of next generation Internet
Strategies, Solutions and Software for Global 2000 organizations. The
intellectual property of itemus is developing a new breed of solutions and
software for the new economy and providing a unique delivery mechanism for
organizations. itemus focuses investing efforts in three areas comprising the
next generation Internet: rich media, mobile economy and collaborative
commerce. For more information, please visit the company's Web site at
www.itemus.com
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For further information: Investors: Susan Wilson, itemus Investor
Relations, toll free at 1-888-894-9911 or: investors@itemus.com; Media:
Rob Ireland, Practice Manager, Cohn & Wolfe at (416) 924-5700 x. 4054, or:
Rob_Ireland@ca.cohnwolfe.com |
