Yahoo Finance Raid on UK PLC continues as games developer Sumo and podcast group Audioboom targeted
The extraordinary boom in takeovers of UK-listed businesses continued on Monday as two more public companies were targeted for acquisition.
Chinese tech giant Tencent (0700.HK) announced it had reached a deal to buy UK-listed games developer Sumo (SUMO.L) for £919m ($1.2bn).
Separately, All Active Asset Capital (AAA.L) — a UK-listed money manager — said it was considering a bid to take Audioboom (BOOM.L) private at £188m. All Active Asset Capital has secured the support of Audioboom investors holding around a quarter of the company's stock.
The dealmaking extends a boom that began at the start of the year and has largely focused on the private equity industry. Private equity houses have announced over 120 deals for British companies so far this year, including major names such as Asda and Morrisons (MRW.L).
Tencent said it had agreed a deal with Sumo's board to buy the company at 513p a share. The offer represents a 43% premium on Friday's closing price and shares in Sumo jumped 42.5% at the open in London on Monday.
Ian Livingstone, Sumo's non-executive chairman, said: "The board of Sumo firmly believes the business will benefit from Tencent's broad videogaming ecosystem, proven industry expertise and its strategic resources, which will help secure and further the aspirations and long-term success of Sumo.
"The board of Sumo considers that the acquisition is in the best interests of all stakeholders in the company and intends to unanimously recommend this offer to shareholders."
Founded in Sheffield in 2003, Sumo Group is one of the UK's largest full-service video game developers. It partners with the likes of Apple, Marvel, and Xbox and has worked on titles such as Mortal Kombat, Football Manager, and racing game Forza. Tencent has been an investor since 2019.
James Mitchell, chief strategy officer and senior executive vice-president of Tencent, said the takeover would "accelerate the growth of Sumo both in the UK and abroad". Sumo currently employs over 1,200 people across 14 studios around the world.
Elsewhere, AIM-listed All Active Asset Capital said it was considering a cash-and-shares bid for Audioboom worth £12 a share. The potential offer price represents a 35% premium to Friday's closing price. Audioboom's stock rallied 15% on the announcement, reflecting uncertainty around whether All Active Asset Capital will make a firm offer.
Audioboom hosts, creates, and monetises podcasts on its platform. QI's popular podcast No Such Thing As A Fish uses its platform and Audioboom makes its own shows, including An Hour or So With Sue Perkins. Nick Candy, the billionaire property developer, is a longtime investor in the company and has backed the potential takeover.
If the deal goes through, Audioboom is likely to be yet another UK-listed business that exits the British market.
While All Active Asset Capital is currently listed on London's junior AIM market, the company announced plans at the start of the month to delist shares and seek another listing elsewhere, most likely in the US. All Active Asset Capital is in the midst of striking a number of deals for stakes in, or ownership of, tech companies. The money manager said it would pursue an international listing "more suited to AAA's portfolio of exciting, high growth technology investments" — a blow for London's market.
The likely fall of two more UK businesses into overseas ownership will set more alarm bells ringing in Whitehall. Some MPs have expressed concerns about the 'raid' on UK publicly listed companies (PLCs). The string of take-private deals and overseas acquisitions has left the future of thousands of jobs and the management of major companies harder to scrutinise and influence.Wa
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