XLMedia PLC Sells North American Business to Sportradar AG

LONDON – XLMedia PLC (AIM: XLM), a prominent provider of digital sports media services, has entered a conditional agreement to sell its North American business to Sportradar AG for up to $30 million in cash. The transaction includes an upfront payment of $20 million and a potential additional $10 million based on performance, which is payable in April 2025.

The sale is dependent on shareholder approval at a General Meeting set for November 7, 2024, with completion expected soon after. Sportradar has already gained voting support from stakeholders holding around 31.18% of XLMedia's ordinary share capital.

Once the sale is finalized, XLMedia will transition into an AIM Rule 15 Cash Shell (LON:SHEL), focusing on distributing the proceeds from this sale and the previously announced sale of its European and Canadian assets. The North America business generated a revenue of $27.5 million and an estimated adjusted EBITDA of $5.5 million for the year ending December 31, 2023. The total valuation of the North American disposal reflects a multiple of 5.5 times its 2023 adjusted EBITDA.

Including both North American and European disposals, XLMedia expects to generate up to $72.5 million in cash before costs and liabilities. This strategic decision follows the company's conclusion that the individual value of its businesses was not being fully recognized in its share price.

The decision to sell comes after the company's efforts to integrate three acquired entities into its North American operations and develop strong partnerships within the U.S. market. Despite these efforts, U.S. revenue growth did not meet initial expectations. The Board believes that the sale of its North America Business to Sportradar represents a fair valuation of the standalone business’s future revenue and profitability.

Chairman Marcus Rich noted that the agreement to sell the North America Business to Sportradar aligns with the Board’s commitment to maximizing shareholder value, especially after the European asset disposal. The company expects an initial distribution from the net proceeds to shareholders before the end of the year.

Details regarding the North America disposal and the upcoming General Meeting will be shared in a circular to shareholders and will also be accessible on the company’s website.

This article was generated with AI assistance and reviewed by an editor. For more information, see our T&C.