REG - XLMedia PLC - Update on distribution of capital

XLMediaAnnouncement

16/12/2024 07:00

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RNS Number : 1276Q  XLMedia PLC  16 December 2024

This announcement contains inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014. Upon the publication of this announcement, this
information is now considered to be in the public domain.

 

16 December 2024

 

XLMedia PLC

("XLMedia" or the "Group" or the "Company" or the "Business")

 

Update on distribution of capital

 

XLMedia (AIM: XLM), a sports and gaming digital media company is providing an
update on its plans for an initial distribution to shareholders from the
proceeds of the assets sales related to the Europe Disposal and the North
America Disposal (together, the "Disposals").

 

The Group, having successfully completed the sale of materially all the assets
of the Group in two transactions, the Europe Disposal in April 2024 and the
North America Disposal in November 2024, became an AIM Rule 15 Cash Shell and
re-confirms that it has no plans to make an acquisition that constitutes a
reverse takeover under AIM Rule 14 or become an investing company.  It
therefore proposes to undertake an initial tender offer for up to £16
million, circa $20 million in the New Year.  This would represent
approximately half the Company's current market capitalisation and
approximately half the potential total available cash after taking account of
reasonably expected costs and liabilities and expected further receipts due
from the Disposals (both deferred consideration and projected earn out).

 

Cash at the end of October was $17.7 million, with gross proceeds received in
November of $20 million. The Group is due to receive $7.5 million on 1 April
2025 in relation to the Europe Disposal from Gambling.Com Group Limited. It is
also eligible for earnout payments of up to $15 million across both Disposals,
both payable in April 2025.

 

The Board is tracking performance of the assets in Europe and North America.
While it cannot be certain of the eventual level of earnout that will be
achieved, on the basis of current information and extrapolating current
trends, it estimates that the earnout amount would be approximately between $3
million to $4 million, and possibly up to $5 million.  The exact amount will
depend on final trading in the last months of 2024 and the mix of revenues.
Agreed earnouts are not expected to be finalised until late Q1 2025.

 

The Group continues to be focused on minimising costs while supporting the
transitional services agreements for both Disposals, including a rapid
reduction in staff numbers.  The Group estimates its costs to clear
liabilities including deferred minimum guarantee payments, settle tax in each
jurisdiction in which it operates, support the transitional service agreements
and close down the Group, including redundancy payments to be in the order of
$11 million to $13 million. The final tax charges included in these costs
 will be determined once 2024 tax submissions are completed and agreed and
final transaction proceeds for the Disposals are known and could vary from the
estimates made.

 

As part of its ongoing focus to reduce cost, while maintaining effective
corporate governance, the Group is reviewing the structure of the board in
light of outstanding requirements.

 

 

 

Marcus Rich   Independent Non-executive chair, commented:

 

The Board wishes to maximise the return of value to shareholders while
ensuring that the Group's operations are brought to an orderly close, and are
reviewing the structure of the board  in  overseeing the efficient winding
down of the group.

 

 

For further information, please contact:

 XLMedia plc                                           ir@xlmedia.com

 David King, Chief Executive Officer

 www.xlmedia.com (http://www.xlmedia.com)

 Cavendish Capital Markets Limited (Nomad and Broker)  Tel: 020 7220 0500

 Giles Balleny / Callum Davidson (Corporate Finance)

 Charlie Combe (Corporate Broking)

 www.cavendish.com (http://www.cavendish.com)

 

About XLMedia

 

XLMedia (AIM: XLM) has recently disposed of its sports and gaming digital
media operations.

 

 

Forward Looking Statements

 

This announcement contains forward-looking statements. Forward-looking
statements are neither historical facts nor assurances of future performance.
They are based only on our current beliefs, expectations and assumptions
regarding the future of our business, future plans and strategies,
projections, anticipated events and trends, the economy and other future
conditions. Because forward-looking statements relate to the future, they are
subject to inherent uncertainties, risks and changes in circumstances that are
difficult to predict and many of which are outside of our control. Our actual
results and financial condition may differ materially from those indicated in
the forward-looking statements. Therefore, you should not rely on any of these
forward-looking statements.

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