Compel snaps up Web design company

Compel is forking out up to £10.5 million for Pangaea Ltd, a UK Web design and Internet services company. Guilford-based Pangaea is being kept as a stand-alone business within the Compel group, but was this morning renamed Compelreach. Pangaea's clients include Benetton F1, HSBC and Yellow pages. The company made a pre-tax profit of £572,000 for the year ended 30 September 1999, on sales of £1.3 million, and has net assets of £381,000. Initial consideration for the buyout is £2.5 million – consisting of £1.75 million cash and £750,000 million in Compel shares. The maximum spend will be £10.5 million, depending on Compelreach's performance, Compel said. In a trading update, Compel said its own financial performance was in line with expectations. "Early indications suggest that companies are passing through the year 2000 date change without serious incident," it stated. "This lends weight to Compel's strong belief that a marked upturn in expenditure levels will begin in the first half of 2000. "Compel remains very positive about its market." This came three months after the company issued a profit warning for its financial year ending June 2000, where it blamed Y2K for its woes. ® Related stories: Compel declares record profits Compel rings the changes with new division