(CelebrityAccess MediaWire) — Sanctuary Group confirmed today that talks on a buy-out had collapsed, and that the financially-pressed company’s trading conditions remained “difficult” going forward.
The London-based firm had announced on June 3rd that it was in talks with a third part that could result in a bid for part or all of the company. Today, it announced that those negotiations we “unlikely to lead to an offer at or near to the current share price.”
Discussions will continue with a number of third parties, according to Billboard.biz, which could lead to “a range of possible transactions including a possible offer for the company.”
Sanctuary, which has recently helped to re-launch the careers of Morrissey, Robert Plant and Alison Moyet, issued a statement to the London Stock Exchange which said, “trading has remained difficult which, together with the operational constraints placed on the business during this time, seems likely to result in a further deterioration of the results for the full year.”
The company’s directors are now reviewing expectations against forecast for the August-September trading period. The company’s stock price was at its lowest point in more than 13 years when markets opened this morning.
The company posted in June what it called “regrettable and unacceptable” first-half financial results. Most blame was directed to its bullish expansion activities in recent years and on the “slippage” of urban genre album releases.
“While we are relieved that Sanctuary has renegotiated some its covenants, we believe the situation remains highly risky until Sanctuary provides some evidence of being able to pay down debt, perhaps through a disposal of some of its music catalog,” Numis Securities, which formerly handled brokering for Sanctuary, said today in a research note, according to Billboard.biz.
Discussions of the sale of unidentified businesses are ongoing, focused especially upon the underperforming books division. –by CelebrityAccess Staff Writers