Viaplay shares fall 18% after company seeks recapitalisation, postpones results (updated)
24/10/2023 09:01
(Adds analyst, share price reaction)
OSLO, Oct 24 (Reuters) - Shares in Swedish streaming
company Viaplay VPLAYb.ST fell 18% on Tuesday after the
company said it is in talks with three major shareholders as
well as lenders and bondholders on a recapitalisation, and is in
discussions to sell non-core operations.
Viaplay said late on Monday that due to the talks, it would
postpone its third-quarter earnings report to no later than Nov.
29, rather than the original plan of reporting on Tuesday.
Under pressure to stabilise its business as rising living
costs dented consumer demand, Viaplay in June replaced its CEO
and has repeatedly warned of a weakening business environment.
The company's shares hit an all-time low of 22.72 Swedish
crowns on Tuesday, down 88% year-to-date.
A restructuring of the group's balance sheet was widely
anticipated, but the earnings delay pointed to a drawn-out
process, analysts said.
"They seem to need more time before announcing a final plan
regarding how to recapitalise the firm," Kepler Cheuvreux
analyst Kristoffer Carleskar said.
Viaplay did not name the shareholders, lenders and
bondholders involved in the talks.
New CEO Jorgen Madsen Lindemann in July announced layoffs
and said the company would focus on its core Nordic, Dutch and
Viaplay Select operations, while downsizing, partnering, or
leaving other markets.
"The group has already reduced its workforce by over 30%
since July, as well as discontinuing a number of original
productions and renegotiating a number of distribution
partnerships," Viaplay said in its statement late on Monday.
Vivendi's VIV.PA CANAL+ Group in July bought a 12% stake
in Viaplay, while Norwegian media group Schibsted SCHA.OL said
last month it had bought a 10% stake, making them the two
largest shareholders according to LSEG data.
(Reporting by Terje Solsvik and Marta Frąckowiak
Editing by Bill Berkrot and Susan Fenton)
((terje.solsvik@thomsonreuters.com; +47 918 666 70;))