VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb. 18, 2014) - LX Ventures Inc. (TSX VENTURE:LXV) ("LXV" or the "Company") is pleased to announce that it has completed the acquisition of Copper Cloud Inc. ("Copper"). Copper is an acquirer, developer, integrator and provider of developer tools that allow today's modern full-stack cloud-based business applications to be developed, deployed, monitored and managed. Copper has acquired or developed and integrated a nine product suite of best-in-class tools utilized by thousands of developers supporting millions of end-users.
Enterprise spending on the cloud is expected to triple over the next three years to an estimated $235.1 billion by 2017, according to a new report from IHS. This year, spending is forecast to jump 20% over 2013 levels to $174.2 billion.
Copper has over 30,000 users and a sustained month over month revenue growth rate of 11%. Copper works with clients including SAP, McCann Worldwide, Glassdoor, AT&T, Salesforce, Peoples Bank and active new user signups are growing at 5% per month. In 2013 Copper focussed on integrating a number of acquisitions and growing the technology team - which now stands at 17 engineers. In 2014 Copper will be focussed on executing an integrated sales and marketing strategy and bringing the Copper brand of full stack simplified setup, excellent managed customer support, and thought leadership into enterprise IT teams. Copper currently has 9 cloud management tools, which are complementary within the new development stack, and will continue to look for strategically relevant acquisitions, or in-house productization opportunities.
Copper CEO Ed Byrne said, "Our entire Copper team is extremely pleased to be working with LX Ventures. We are an active developer and acquirer of technology assets in the very hot cloud application deployment space and continuing to build our company within the LXV family allows us to accelerate our growth beyond what would be possible independently. We are building a world class company, and LX Ventures' resources allow us to do that faster."
Under the terms of the acquisition, LXV has acquired all of the issued and outstanding share capital of Copper. Payment at closing included the initial payment of 2,183,333 common shares and $500,000 in cash. Based on the accelerated revenue growth achieved by Copper since the letter of intent was signed in November, Copper has also met certain agreed financial performance milestones, resulting in an additional 2,777,776 common shares and $1,000,000 in cash being paid at closing. A final payment of 694,444 common shares and $500,000 is due upon Copper achieving a final revenue growth milestone, with the vendors having the election to receive up to $500,000 in cash, in lieu of the final share installment. The common shares issued are subject to various escrow and pooling restrictions over a 24 month period.
LXV CEO Mike Edwards added, "We believe that in an increasingly mobile world enterprise spending on the cloud will continue to expand dramatically as the cloud has become the critical tool for businesses to deploy their products and services. The Copper acquisition creates a platform that will allow LXV to make additional accretive acquisitions to accelerate revenue growth. We will continue to aggressively pursue these opportunities and have already identified several suitable acquisition targets."
LXV has also entered into a secured acquisition facility in the principal amount of $1.5 million, with an arm's length party. Funds advanced under the facility will bear interest at a rate of 9% per annum and mature on February 13, 2015, subject to earlier repayment in certain circumstances.
About LX Ventures
LX Ventures acquires and accelerates high growth technology companies. We are vertically integrated with internal best-in-class practice area teams in sales, marketing, engineering and finance that are leveraged to turn our portfolio companies into industry leading organizations, one by one. We are in the business of building businesses. For further information about LX Ventures, please visit: www.lxventures.com.
Copper.io provides full stack ops & monitoring in one place. Having deep roots in Cloud Usage and Analytics reporting, Copper.io has assembled a full stack developer toolset to help deploy, operate and monitor apps in the Cloud. Their focus has and will continue to be producing best-in-class Cloud deployment tools - by developers, for developers. For further information about Copper please visit: www.copper.io.
ON BEHALF OF THE BOARD
LX VENTURES INC.
Mike Edwards, CEO
CAUTIONARY NOTE: FORWARD-LOOKING STATEMENTS. Other than statements of historical fact, all statements included in this news release, including, without limitation, statements regarding future plans and objectives of LX are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Factors that could cause actual results to differ materially from those expected by LX are those risks described herein and from time to time, in the filings made by LX with Canadian securities regulators. Those filings can be found on the Internet at: http://www.sedar.com.
Neither the TSX Venture Exchange nor its Regulatory Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.