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Perform gets cash offer

The recent cash offer for digital sporting rights group Perform offers investors the chance to exit at a substantial premium
September 2, 2014

Shares in digital sporting rights group Perform (PER) jumped a quarter to 258p after privately-held Access Industries - which already owns a 42.5 per cent stake - launched a 260p cash per share offer. Access says the offer is final and won't be increased.

IC TIP: Hold at 258p

Despite revealing a first-half operating loss of £3.3m late last month, management responded by reiterating its confidence in Perform's "standalone strategy and growth prospects". That possibly reflects the 28 per cent sales hike at the group's thriving content distribution unit, which provides live video, sports news and data to bookmakers, broadcasters and mobile operators.

Similarly, Perform's smaller display advertising business grew sales by over two-thirds at the half-year stage as it relaunched its Goal website and won World Cup-related contracts with Sony and Puma. Its success helped Perform's websites to attract 118m monthly unique users, up 40 per cent year on year.

Perform also tackled its climbing costs by closing 10 regional offices and removing a fifth of its managers. The full-year cost base should therefore grow 16 per cent after soaring by a half in 2013. Broker Numis Securities expects full-year pre-tax profit to rise to £32m from last year's £26m, giving EPS of 10p.