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PCG Entertainment to sell ill-fated CPDC subsidiary

Existing PCG shareholder Kolarmy Technology is among the consortium of investors buying CPDC
Agreement
The sale removes a cloud hanging over PCG

PCG Entertainment Plc (LON:PCGE) is to draw a line under its ill-fated acquisition of games delivery platform Center Point Development Corp (CPDC) by selling it.

Subject to shareholder approval, the company will sell CPDC to a consortium of investors, some of whom are existing shareholders of PCG, while others are thee previous owners of the company.

PCG purchased CPDC in August 2015, shelling out 114.8mln shares plus US$410,000.

It was not long, however, before PCG became entangled in dispute between the sellers of CPDC and its major supplier. 

It has proved impossible to resolve the dispute amicably, and the disagreement hung over the company like a black cloud, affecting trading and preventing PCG from developing the business in the way it intended.

After a long period of negotiation, it has been decided that the best solution is for PCG to cut its ties with the company.

The purchasers of CPDC will effectively sell 399.8mln PCG shares through the company’s broker, with the proceeds then handed over to PCG.

The shares to be sold represent around 30% of the PCG shares currently in issue, which partially explains the 10.5% fall in the share price of PCG on the announcement.

"These negotiations have been long and complex, and have meant the board has been unable to provide clarity to shareholders on the position with CPDC until now; we are pleased to be able to disclose this previously inside information,” revealed Richard Poulden, chairman of PCG. 

“We look for forward to building the other business streams within the company," he added.

 

 

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Article
November 04 2016

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