Accentuate Limited (JSE: ACE) concluded a binding heads of agreement to acquire Pentafloor Proprietary Limited for ZAR 40 million on May 11, 2017. The total consideration of ZAR 40 million includes ZAR 20 million as earn out payments. The initial payment of ZAR 20 million will be paid in cash of ZAR 16 million and rest ZAR 4 million by way of issuing 5.06 million Accentuate Limited shares. Accentuate will make two additional payments based on the following conditions: A payment of up to ZAR 10 million will be based on Pentafloor achieving a minimum profit after tax of ZAR 6.6 million for the 12 months ending February 2018. If the actual profit after tax achieved be less than the 2018 earnings target for the 12 months ending February 2018, no first additional payment will be payable. The first additional payment will be settled by no later than the 10th business day following the audit of Pentafloor’s financial statements for the 12 months ending February 2018. A second additional payment of up to ZAR 10 million will be based on Pentafloor achieving a profit after tax of ZAR 7.35 million for the 12 months ending February 2019. If the actual profit after tax achieved be less than the 2019 earnings target for the 12 months ending February 2019, no second additional payment will be payable. The second additional payment will be settled in cash or a combination of cash and shares, in Accentuate’s discretion, and settled on the applicable date. Accentuate intends to finance the Purchase Consideration by way of cash, bank debt and the issue of new shares as indicated above. The sellers of Pentafloor Proprietary Limited shall be restricted from selling the initial payment shares for a period of 15 months and thereafter shall only be entitled to sell 50% in any one calendar year. The completion of the transaction is subject to the fulfillment or, where applicable, waiver, of the following conditions precedent by no later than June 16, 2017: approval of the acquisition by Accentuate’s board of directors, conclusion of the final legal agreements, which will contain standard warranties and indemnities for a transaction of this nature, Accentuate notifies the Sellers that it is satisfied with the results of its due diligence investigation into Pentafloor, all regulatory and statutory approvals and/or waivers be obtained, sellers entered into new employment contracts with Pentafloor to the satisfaction of Accentuate and to the extent necessary, the written consent of third parties to material contracts of Pentafloor and to the extent necessary, the written consent of third parties to material contracts of Pentafloor, agreeing to the change in ownership of Pentafloor. As of October 23, 2017, the transaction became unconditional. The effective date of the acquisition will be July 1, 2017. The acquisition will be earning enhancing Bridge Capital Group Limited acted as financial advisor and Fullard Mayer Morrison Attorneys acted as legal advisor to Accentuate Limited. Accentuate Limited (JSE: ACE) completed the acquisition of Pentafloor Proprietary Limited on October 23, 2017.