By Elena Vardon
XLMedia conditionally agreed to sell its North America business to Swiss sports data and analytics company Sportradar for up to $30 million in cash.
The London-listed digital media company said Monday that following the deal's completion, which is expected shortly after its general meeting on Nov. 7, it will become a cash shell entity focused on distributing the proceeds from the North America and previously announced Europe and Canada asset disposals. Together, these generated $72.5 million in cash before costs and liabilities.
"While it was confident that the U.S. market would provide long term success for a larger organization, the board believes XLMedia's current scale on a standalone basis could impact its ability to compete in the evolving U.S. market," it said.
XLMedia's North America business made $27.5 million in revenue for 2023 and $5.5 million in estimated adjusted earnings before interest, taxes, depreciation and amortization, it added.
The group will receive $20 million in cash and an extra $10 million payable next April subject to performance, if the transaction is approved. The offer represents an implied value of up to 8.8 pence per share and 5.5 times adjusted Ebitda for 2023 for the business. XLMedia's shares closed at 9.3 pence on Friday.
The board said it considers that Sportradar's offer represents a fair net present value for the business's future revenue and profitability.
"We anticipate an initial distribution from the net proceeds to shareholders before year end," Chair Marcus Rich said.
Write to Elena Vardon at elena.vardon@wsj.com
(END) Dow Jones Newswires
October 21, 2024 02:48 ET (06:48 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
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