XLMedia confirms plans for North America Business sale to Sportradar

The sports digital media company, XLMedia, announced Monday a strategic move that will see the sale of its North America Business to Sportradar AG.

XLMedia uncovered details regarding the transaction, confirming it has entered into a condition asset purchase agreement with Sportradar.

The acquisition of the assets has a price tag of $30m

Under the aforementioned agreement, the latter company will pay up to $30.0 million in cash for XLMedia's North American assets.

A breakdown provided by XLMedia confirms that $20.0m will be paid upon completion of the acquisition of the assets.

On the other hand, XLMedia may collect up to an additional $10.0m in April next year, contingent on the performance of the business.

Marcus Rich, XLMedia's Chairman, commented on the topic in a statement released by the company.

"In an ongoing commitment to maximize shareholder value, following the Europe Disposal, the Board is pleased to have reached an agreement to sell the North America Business to Sportradar pending shareholder approval," he explained.

Finally, Rich outlined: "We anticipate an initial distribution from the net proceeds to shareholders before year end."

XLMedia to become an AIM Rule 15 Cash Shell

As noted by XLMedia's executive, the disposal of the company's North American assets follows a similar move the company completed in Europe as well as Canada.

A calculation provided by the sports digital media company reveals that combined, the disposal of the European assets and the North American business "including all earnout payments due, would generate up to $72.5m in cash before costs and liabilities."

XLMedia pointed to the revenue reported by its North American Business which was $27.3m for the year ended December 31, 2023, as well as the estimated Adjusted EBITDA for the same period which hit $5.5m.

The proposed consideration for the company's assets in North America represents "an implied value of up to 8.8p per Ordinary Share and a multiple of 5.5 times Adjusted EBITDA 2023 for the North America Business," as explained by XLMedia.

Once the completion of the transaction, the company is expected to become an AIM Rule 15 Cash Shell.

Its focus following this transformation would be to solely distribute the proceeds to the shareholders accumulated from the sale of the company's North American and European assets.

Still, it's important to note that the sale of XLMedia's North America Business is subject to the approval of the company's shareholders.

The topic will be up for discussion at the upcoming General Meeting of the company scheduled for November 7, 2024.

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