ian walker
Shares in Immotion Group PLC jumped 79% on Thursday after the company said it would sell its location-based entertainment business for an enterprise value of $25.2 million and return up to 13.5 million pounds ($16.7 million) in assets. money to shareholders.
Shares were up 1.10p, or 50%, at 3.30p by 0852 GMT, having peaked at 3.94p earlier in the session.
The UK-based immersive entertainment company said that while it believed in the growth opportunities in the LBE business, the current macroeconomic environment made it more challenging and more capital was needed to accelerate growth. It said the board doubted that debt financing could be secured on acceptable terms and that it did not want to raise equity.
It said the company would retain the home entertainment business, which it believes has great potential.
“Given the current economic environment, we believe this is a good deal for all shareholders, allowing us to not only return cash per share in excess of today’s share price, but to move forward with renewed vigor and cash from plc vehicles,” Chief Executive Officer Martin Higginson said.
Immotion said it would use the remainder of the proceeds from the sale for future opportunities for the group. The company did not say how it plans to return the money to shareholders, which equates to around 3p per share.
The sale is subject to shareholder approval at a general meeting on Feb. 8. 21. If approved at the meeting, the board plans to change the company’s name to Let’s Explore Group PLC.
Write to Ian Walker at ian.walker@wsj.com