ITE's emerging market hit takes shine off Mining Indaba deal

By Shariq Khan and Noor Zainab Hussain

(Reuters) - Exhibition organiser ITE (ITE.L) said it would buy Mining Indaba, the world's largest mining investment conference, from Euromoney (ERM.L), but added that the fall in the Russian rouble, Brazilian real and Turkish lira would hurt 2019 results.

The warning took the shine off the Mining Indaba deal, which analysts said was a positive move. The stock was down 5.9 percent at 70.7 pence in early trade.

Peel Hunt analysts cut their 2019 profit expectations by about 7 percent, citing a combination of currency woes, exhibition closures and timing changes, as well as money spent on buying Mining Indaba.

ITE, which was founded in 1991 and runs over 240 exhibitions and conferences in countries including Russia, India and China, also forecast a 10 percent rise in annual like-for-like revenue for this year, helped by its focus on core markets.

ITE set a three-year turnaround plan last year to focus on core market leading events, after unrest in Turkey and the scrapping of high-value banknotes in India affected some planned events.

The firm bought a portfolio https://reut.rs/2DUiRtA including Africa Oil Week and moved into Africa in 2015 after it was hit by a plunging Russian rouble and political upheaval in Ukraine in 2014.

ITE said its customer base and ministries across Africa could benefit from the two events operating under one owner.

"In buying Mining Indaba, ITE is getting another major brand. The price is respectable (Euromoney paid 45 million pounds initially)," Peel Hunt analysts said.

Mining Indaba, which will run for its 25th year in 2019 in Cape Town, is attended by more than 2,000 companies. The event generated sales of 7.2 million pounds in the year ended February, ITE said.

The 30.1 million pound deal will be funded through a combination of ITE's existing cash and loans and will add to earnings its first full year of ownership, ITE added. Investec analyst David Amiras said the benefit would be between 5-6 percent.

London-based Euromoney, which is 49.04 percent-owned by Daily Mail & General Trust (DMGOa.L), said it was selling the business because it did not align with its strategy.

"We will sell it and recycle capital towards our main investment themes," said Euromoney Chief Executive Andrew Rashbass.

In 2017, Euromoney sold its Paris-based exhibition business, and then stakes in World Bulk Wine and Dealogic, a provider of financial content and analytics. The firm sold its global markets intelligence division to a Chinese consortium earlier this year.

(Reporting by Shariq Khan, Noor Zainab Hussain and Muvija M in Bengaluru; Editing by Amrutha Gayathri)