TIDMMRIT
RNS Number : 2556E
Merit Group PLC
27 October 2022
27 October 2022
Merit Group plc
("Merit", the "Company" or the "Group")
Disposal of Media, Events and Training Operations
Merit Group plc (AIM: MRIT), the data and intelligence business,
announces that it has agreed to sell the Media, Events and Training
operations of its Dods Political Engagement business (together, the
"MET Operations") to Political Holdings Limited, a private company
owned by Lord Ashcroft KCMG PC, for a cash consideration of GBP4.5
million (the "Disposal").
In the year ending 31 March 2022, the MET Operations generated
revenue of GBP9.3 million and an adjusted EBITDA of approximately
GBP0.5 million, with net assets of GBP0.5 million as at 31 March
2022.
Merit expects the Disposal to complete in the current calendar
year. The Disposal remains subject to the satisfaction of certain
conditions, including satisfaction of financing by Political
Holdings Limited. Following completion the Group will use the net
proceeds(1) to pay down its net debt(2) , which as at 30 September
2022 was GBP3.2m, and to fund the growth plans of its ongoing
business intelligence operations.
(1) Net proceeds comprise GBP4.5m consideration, to be adjusted
for normalised working capital, less transaction costs
(2) Net debt/net cash comprises the aggregate of gross debt,
excluding IFRS16 lease liabilities and cash and cash
equivalents
Background to and reasons for the Disposal
Following the Group's change of name and new strategic focus
announced in March 2021, and having conducted an internal review of
its operations, the Board of Merit concluded earlier this year that
the Group was overly diverse and complex given its market size and
that it needed to focus its future strategy on its core data and
intelligence offerings. These core operations comprise; the market
leading Dods Political Intelligence service with over 800
subscribers in the UK and Europe, which generated GBP6.9 million of
subscription revenue in the last financial year; and the data and
intelligence business of Merit Data & Technology which
generated GBP10.7 million, the significant majority of which is
recurring revenue.
The Board of Merit believes focussing on business intelligence
will allow it to grow its core business operations and improve
returns to shareholders.
Political Holdings Limited owns three companies in the media
sector, focused on politics and government: Biteback Publishing
(Britain's leading political publisher), Campaigns & Elections
(the non-partisan go-to resource for political campaign
professionals in the USA and Mexico), and ConservativeHome (the
UK's premier independent conservative news and analysis site).
Merit believes that its MET Operations will benefit from the focus
that will come from being part of a company specialising in media
and events.
David Beck, CEO of Merit Group plc, said:
"This is an important step for Merit. The Disposal will allow us
to focus on the parts of the Group with recurring or subscription
revenue, attractive margins and strong cash generation. Following
the Disposal we will become fully focussed on the business
intelligence sector.
"This transaction, together with the disposal of our minority
stake in Social 360 announced in July, will mean we have raised
GBP5m from the disposal of non core assets. When set against our
market capitalisation of approximately GBP8.5m these are obviously
significant strategic developments."
Related Party Transaction
Political Holdings Limited is owned by Lord Ashcroft KCMG PC, a
substantial shareholder in the Company as defined by the AIM Rules.
Further, Angela Entwistle, a non-executive director of the Company,
is a director of Political Holdings Limited.
The Disposal therefore constitutes a related party transaction
under Rule 13 of the AIM Rules. The Independent Directors of the
Company (being all Directors save for Angela Entwistle) consider,
having consulted with Canaccord Genuity Limited in its capacity as
the Company's nominated adviser for the purposes of the AIM Rules,
the terms of the Disposal to be fair and reasonable insofar as the
Company's shareholders are concerned.
About Merit's Media, Events and Training Operations
Included in the MET Operations in the Disposal are the leading
political news website Politics Home and magazines such as The
House, Holyrood and The Parliament as well as the online
publication Civil Service World. Under the Dods brand the Company
runs events such as its Diversity & Inclusion Series that
includes Women into Leadership events; in Scotland the annual
Holyrood Garden Party and Political Awards and in Brussels the MEP
Awards. The Company also runs events for others, notably Government
Departments including Civil Service Live and the CS Awards. Dods
Training runs training courses for civil servants as well as NGOs
and commercial organisations.
For further information contact:
Merit Group plc
David Beck - CEO 020 7593 5500
www.meritgroupplc.com
Canaccord Genuity Limited (Nomad and Broker)
Bobbie Hilliam 020 7523 8150
This announcement contains inside information for the purposes
of article 7 of the Market Abuse Regulation (EU) 596/2014 as
amended by regulation 11 of the Market Abuse (Amendment) (EU Exit)
Regulations 2019/310. With the publication of this announcement,
this information is now considered to be in the public domain.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
MSCFFFFIIALRFIF
(END) Dow Jones Newswires
October 27, 2022 02:00 ET (06:00 GMT)
Merit (LSE:MRIT)
Gráfico Histórico do Ativo
De Nov 2024 até Dez 2024
Merit (LSE:MRIT)
Gráfico Histórico do Ativo
De Dez 2023 até Dez 2024
