Premarket London: FirstGroup Prepares Sale of U.S. Bus Operations

Investing.com — Here is a summary of the most important regulatory news releases from the London Stock Exchange on Monday, 16th December. Please refresh for updates.

• Retailer Sports Direct (LON:) reported a 6.1% decline in organic, currency-adjusted group revenues in the six months through October.
• Overall revenue increased by 14% to 2.04 billion pounds thanks to past acquisitions including Game Digital, which contributed 133.9 million pounds.
• Underlying EBITDA was up 22% to £181.2m.
• The group cited its new elevation strategy – an investment program to pep up the appearance of its stores – as the reason for the overall drop.
• Mike Ashley’s empire, which bought department store House of Fraser in 2018, said profit before tax increased by 160% to £193.4m due to improved underlying operating performance and an £84.9m gain arising from the sale of one of its distribution centers.

• Train and bus operator FirstGroup (LON:) has given in to pressure from shareholders Robert Tchenguiz and Coast Capital, and appointed advisors to review its North American contract businesses First Student and First Transit, with a view to a possible sale.
• The news comes around a month after FirstGroup’s share price tumbled after it wrote down the valuation of its Greyhound bus operations in the U.S., which it has been trying to sell since May.
• The decision “reflects the resolute focus of the entire Board on realising value for all shareholders,” CEO Matthew Gregory said.

• Cinema operator Cineworld (LON:) proposed to buy Cineplex, Canada’s largest operator of movie theaters, for 2.8 billion Canadian dollars in cash (US$2.21 billion). Global City Theatres BV, Cineplex’s largest shareholder, has already agreed to the deal.
• The deal will be financed by debt. Cineworld said it expects $130 million of annual synergies, and a boost of over 10% to earnings per share in the first year following completion. It will aim for a net debt/EBITA ratio of 3x by the end of its fiscal 2021 year.
• Cineplex runs 165 cinemas and 1,695 screens and has a 75% market shares in Canada. The portfolio would significantly strengthen Cineworld’s position, given its ownership of the Regal chain of theaters in the U.S., which it is currently revamping.
• “The combination of Cineplex and Regal will create the leading North American cinema operator with unrivalled scale and opportunity,” said CEO Mooky Greidinger.

• NMC Health (LON:) said it intends to buy back up to $90 million of its convertible bonds due 2025, noting that their current price of 89.5c represents an attractive opportunity to manage its liabilities.

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