Sportech PLC (LON:SPO) shares dropped 55% on Wednesday as the betting company revealed that takeover talks have failed and said 2017 profits will miss expectations, while trading in the first 10 weeks of its current year has been “fairly challenging”.
The FTSE SmallCap firm said it has terminated all sale discussions with interested parties after concluding that the discussions were “unlikely to result in an offer for all or a material part of the Group that it would be able to recommend to shareholders.”
Sportech also said its adjusted underlying earnings (EBITDA) for 2017 are anticipated to be below prior expectations at around £6.5mln due to a series of accounting corrections including write-downs of old stocks and "doubtful" debtors.
The company added that trading in the first weeks of the current year has been “fairly challenging”, however, it has secured new long-term contracts and therefore “sees no reason currently to change its expectations for 2018.”
The group also announced that it has appointed a new chief executive, Andrew Gaughan with immediate effect to take the betting firm forward as an independent company.
In lunchtime trading, Sportech shares were down 55% to 35p.