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ScreenFX in talks to sell its shopping malls advertising business |
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Monday, 21 May 2007 |
The Cheadle, Cheshire, digital advertising and communications specialist, whose shares are listed on AIM, confirmed it is in talks which may lead to the sale for around £5m, of its MallFX subsidiary, to an unnamed outdoor advertising company.
It is anticipated that a sale could be concluded by the summer.
The AIM-listed company is in exclusive talks with an advertising industry giant, and a deal could be completed by the summer.
The company also announced its latest financials which showed sales up by almost 250% to £1.85m but operating losses widened from £3.5m to £6.6m.
MallFX, the operating subsidiary which the company intends to sell, claims the advertising screens it supplies to malls across the UK, cover 25% of the population with an annualised footfall reach of 750 million people across its sites.
Screens are supplied to 40 malls around the country, including Manchester's Arndale, the Trafford Centre, Birmingham's Bullring, Lakeside at Thurrock, Essex and Gateshead’s Metrocentre.
The company said it planned to expand other elements of its business, primarily its TrainFX and HealthFX operations. TrainFX has won contracts with Central Trains and has secured screens on a number of commuter routes in the London area.
ScreenFX chairman Mike Cottman, who holds a 32% stake in the company, said
“2006 had been a challenging year” but that the train advertising business offered strong potential for growth.
"In an era of an increasingly fragmented advertising industry, the emergence of a major new advertising and communications channel, with a high-profile, captive audience, represents an extremely exciting opportunity for the group to embrace.
"The signing of this indication of interest with a major advertising company is a significant milestone for the group. If concluded successfully, then we believe that this agreement will vindicate the strategy that ScreenFX has implemented since its inception and will provide us with the proceeds to develop other digital screen based advertising sectors.
"Whilst ScreenFX has been successful in building the critical mass in our retail business unit, we have not had sufficient internal resources and expertise to maximise the advertising revenues in this comparatively new medium. We believe that the major advertising company we are in discussions with has the scale and market positioning to deliver the necessary volumes onto the ScreenFX platform.”
How-Do broke the news last week that Trinity North West is to launch a new digital venture with Street Broadcast.
Clear Channel, CBS Outdoor and most recently Ocean, have all announced new investment in the region’s outdoor infrastructure.
http://www.screenfxplc.com/
http://www.trinitymirror.com/brands/regionals/northwest/
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