J.L. Halsey Corporation Acquires EmailLabs For $19.5 Million

On Wednesday, October 12th, J.L. Halsey Corporation (OTCBB:JLHY) acquired Uptilt, Inc. You may not recognize either of these names, but essentially the same company that bought Lyris recently, also just acquired EmailLabs.

According to the details of a BusinessWire release, the merger agreement provides $19.5 million in cash at closing to the owners of Uptilt (of which approximately $2.8 million will be funded through Uptilt’s available cash) and will pay two annual installments totaling up to approximately $3.5 million if EmailLabs achieves specified revenue targets in the first and second year following the closing.

Wow, did you catch that EmailLabs had $2.8 million in cash on hand?

J.L. Halsey funded the acquisition through a five year $18.5 million revolving credit line with Comerica Bank at an interest at the prime rate plus 75 basis points or LIBOR plus 375 basis points with the credit line subject to customary conditions, including certain financial covenants.

After the closing, David Sousa, co-founder, Chairman and CEO of Uptilt and co-founder and CTO, Adrian Liang, will resign but remain as advisors.

According to the release, For the period from January 1, 2005, through September 30, 2005, EmailLabs had approximately $6.4 million in revenue. For 2004, revenue for EmailLabs was approximately $5.7 million with 2004 revenue approximately 80% higher than revenue in 2003.

Jim Herbold, Vice-President of Sales and General Manager of EmailLabs along with other senior managers of EmailLabs, including Loren McDonald, Vice-President of Marketing, and Akshay Vyas, Director of Engineering, will remain with EmailLabs, er, Lyris…

Lyris acquired SparkLIST in 2002 and has not shut down the brand yet, so based on how they have treated acquisitions in the past, perhaps they will leave the EmailLabs brand in tact.

Christopher M. Knight is an e-mail publishing geek that offers free e-mail publishing tools via his weekly newsletter that can help you grow your e-mail newsletter, improve your e-mail deliverability, and solve e-mail newsletter problems: http://Ezine-Tips.com/

Disclosure: As of October 14th, 2005, the author of this article does have an ownership position in the covered security.

[tags]lyris,email labs,david sousa[/tags]