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Sullivan returns to save Sport Media Group |
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Friday, 01 May 2009 |
David Sullivan has come back to Sport Media Group, which he sold in 2007. The Manchester-based publisher has announced that it’s no longer for sale after agreeing new refinancing terms.
Sullivan’s new role will be “honorary publisher” and he’ll be helping the board increase circulation and profitability. The Group has announced an issue of 9.68m ordinary shares at 3.5p each to the former owner.
“The Group has also simultaneously entered into agreements, also subject to formal sign off which is expected within 5 working days, with David Sullivan and Gold Group International Limited whereby these parties have agreed to provide loans, initially for a 18 month period, to the Group which total £1.68m," stated David Bailey, chairman.
"These loans will enable the Group to effect a restructuring and re-organisation of the Sport Newspaper business to restore it to profitability.”
“In return for the provision of these loan facilities, which have been provided at an interest rate of 6.5% pa, options have been granted over 9.68m Ordinary shares in SPMG at a subscription price of 3.5p to David Sullivan. These options represent 9.99% of the currently issued share capital.”
The publisher of the Sunday and Daily Sport said in a statement to the stock exchange that it had also agreed a renewal and enhancement of existing bank facilities for 18 months.
This means that it has terminated discussions with potential suitors and is no longer in an offer period.
Cost savings, including staff reductions means that operating profit is £0.6m (from £3.3m at the same time last year). Turnover has also decreased by 19% to £11.7m. Pre-tax profit is £0.2m. Something to add? Then leave a comment below or email us now.
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