Sportech shares plunge on failed sale process
London-listed operator says it did not receive an offer it could reasonably recommend to the shareholders
Sportech shares plunged by more than 50% this morning as the company confirmed it had been unable to find a suitable buyer in its formal sale process.
The AIM-listed firm said it had engaged in “detailed discussions with interested parties” but had decided these discussions were “unlikely to result in an offer for all or a material part of the Group”.
The firm said it would instead go it alone, highlighting “significant potential” from the potential liberalisation of sports betting in the US.
Richard McGuire, the non-executive chairman of Sportech, said: “Whilst a sale of the company might have delivered an immediate further return to shareholders, in addition to the £75m returned last year, I am confident that the Company has the potential to deliver significant long-term value to shareholders, especially if the US sports betting market is liberalised and also from further diversification strategies.
“We are focused on ensuring Sportech benefits fully from any changes in the US sports betting market and we anticipate announcing exciting new initiatives in due course.”
The strategy will be led by new CEO Andrew Gaughan, whose appointment was also announced this morning.
Gaughan joined Sportech in 2010 following the acquisition of Scientific Games Racing, and was appointed to the Board in January 2017.
He is based in Toronto, where Sportech has an operational presence and has more than 25 years’ experience in the gaming, technology and horseracing industry.
“I welcome Andrew Gaughan to the role of Chief Executive Officer as part of a new leadership team to ensure we execute on our commitment to deliver tangible returns to shareholders,” McGuire added.
The firm also said it was looking for group CFO to be based in the US.
Sportech shares were down 54% to 35p at the time of writing.