Companies roundup: Spirent takeover saga & JD Sports

The board of telecoms equipment maker Spirent Communications (SPT) has accepted a new bid from US-based Keysight Technologies (US:KEYS) that trumps an earlier offer from Viavi Solutions (US:VIAV).

Keysight’s 201.5p all-cash offer is a “superior proposition” for shareholders, given that it is 15 per cent higher than the 175p bid made by Viavi and a premium of almost 86 per cent on Spirent’s closing price on 4 March – the day before Viavi made its offer. It values Spirent at £1.16bn.

Keysight is offering 199p a share, plus a 2.5p special dividend in lieu of any final dividend Spirent would have paid. Spirent’s shares jumped by 11 per cent in early trading to 198p, just below the offer price. MF

Read more: The best picks among struggling telecoms stocks

JD Sports bounces after strong update

Sportswear specialist JD Sports (JD.) had readied shareholders for a weak set of numbers for its 2024 financial year with a profit downgrade in January. But its latest trading update has a more positive story to tell – sales for the year ending 3 February were up 4 per cent on a like-for-like basis at £10.5bn. 

It has stuck with the lower pretax profit guidance of £915mn-£935mn, compared to the initial expectation of over £1bn. The retailer said the Euros and Olympics this summer would likely boost current financial year sales, although chief executive Régis Schultz said “less product innovation and elevated promotional activity” had led to a “challenging” trading environment. Guidance for this year’s pretax profit is £900mn-£980mn, or £955mn-£1bn with an accounting change coming in for 2025. 

JD shares were up 8 per cent. Full profit numbers will be released at the end of May. AH

Find out why fund manager Georgina Brittain loves JD Sports

888 sells off US B2C assets 

William Hill owner 888 (888) disclosed earlier this month that it was pondering getting out of the US business-to-consumer (B2C) market because of weak margins and struggles against leading market operators, and it has now confirmed that it will sell some of its Stateside B2C assets to Hard Rock Digital. The company expects the disposal to complete in the final quarter of this year, with a full exit from US B2C by the end of the year. Management thinks this will boost adjusted cash profits by £25mn a year from 2025, but there will be one-off costs of around £40mn from the exit. 

888 said in its full year results this week that it plans to rebrand as Evoke, as it set out new medium-term financial targets and said it would focus on its core markets. The company grew revenue by 38 per cent to £1.71bn because of the William Hill acquisition in 2022, but statutory pre-tax losses worsened to a negative £121mn. CA

Read more: Move over America – there's a new gambling market in town

Capricorn Energy to pay $50mn special div

This new version of Capricorn Energy (CNE) has carried on with handing back shareholder cash as it settles to life as a far smaller producer. The company will pay a $50mn special dividend in the second quarter, following on from its $568mn in payouts last year as a result of the government of India’s payment in 2022 to put a full stop to the Cairn India battle. 

Capricorn, after a series of failed deals, is now focusing on running assets in Egypt producing around 30,000 barrels of oil equivalent per day (boepd). Sales in 2023 were $200mn, with an operating loss of $87mn. 

The company is now looking to get paid for its oil and gas, which is bought by the Egyptian government. “In 2023, the company's receivables balance increased materially [from $96mn to $168mn], however, throughout my twelve years working in Egypt, and looking further back, the Government of Egypt has always honoured its financial obligations to international investors,” said chief executive Randy Neely. Of the $168mn, $143mn is overdue. The Egyptian government is in dire financial straits, with the IMF injecting yet more cash into the country earlier this month. AH