Sportech signals end to AIM trading 

The board of Sportech Plc has informed investors of its intentions to cancel the trading of ordinary shares on the London AIM Exchange.

The recommendation follows a comprehensive review by the board considering “the pros and cons of the company being publicly traded on the London AIM”.  

The review highlighted substantial costs (both monetary and other) tied to being a publicly traded AIM business considering the size of Sportech’s current operations – with Sportech confirming“ “the Board has concluded that Cancellation and Re-registration are in the best interests of the Company and its shareholders as a whole”. 

Recommending its delisting from the AIM, the board notified investors that a circular will be issued outlining the reasons and background for the proposed changes. A General Meeting will be scheduled to approve the proposed changes. 

To proceed with the cancellation and Sportech’s re-registration as a private business, the board will be required to gain 75% of votes from shareholders at the General Meeting.

Should the delisting be approved, a ‘matched bargain facility’ will be sanctioned by Sportech governance to ensure that shareholders can cash-out ordinary shares on a matched basis post-cancellation. 

The announcement sees Sportech change its strategic direction, which in 2021 saw the company transfer its shareholding from the LSE to the London AIM. At the time, Sportech governance cited that an AIM migration was needed to spotlight the company from blue-chip gambling stocks on the LSE.  

This morning, Sportech published its H1 2023 interim trading report, in which the wagering systems provider matched its 2022 revenues of £13.5m. Citing margin enhancements from its business units, Sportech doubled its adjusted EBITDA to £900,000, as H1 corporate losses (before tax) narrowed to £200,000. 

Corporate governance continues to prioritise ‘shareholder rewards’, in which the company has returned £3.5mto shareholders in August 2023. Cumulative shareholder repayments reached approximately £46m since 2020 and about £121m since 2017.

Chairman Richard McGuire said:  “Despite delivering improving operational results announced today, the substantial financial cost associated with maintaining a public listing, given our current scale, and the increasing volatility in the market valuation is adversely impacting net returns and future prospects. 

“Regrettably, in light of these circumstances, we find it necessary to take the difficult but pragmatic step of proposing delisting from the AIM market today.”