(Alliance News) - TLA Worldwide PLC on Thursday said in intends to change its name to Hawkwing PLC as it will become a cash shell following the sale of its unit TLA Worldwide Australia Pty Ltd.
TLA Worldwide completed the sale of its US unit in December last year for USD5.9 million, with the proceeds received used to reduce the company's debt.
On Thursday, TLA Worldwide said its subsidiary TLA Acquisitions Ltd agreed to sell TLA Worldwide Australia, the company's sports marketing business, to QMS Sport Holdings Ltd, a subsidiary of ASX-listed QMS Media Ltd.
QMS Sport will pay an enterprise value of AUD28.2 million, about GBP15.8 million, for TLA Worldwide's Australian business, comprising of AUD21.5 million in cash and the reminder reflecting the assumption of certain outstanding earn-out liabilities.
The Australian businesses were sold on a debt-free basis, TLA Worldwide noted.
The company expects that the entire net sales proceeds from the proposed sale will be used to repay the reminder of the debt and would leave a modest cash balance in TLA Worldwide.
In 2018, the Australian businesses made a contribution to operating profit of USD3.1 million and had as at December 31 net assets of USD4.5 million.
Should the sale of the Australian business proceed, the company would become a cash shell. TLA Worldwide said it will be seeking shareholder approval; to change the company's name to Hawkwing.
Looking forward, TLA Worldwide said it is considering opportunities in a number of sectors but will focus on an acquisition that can create significant value for shareholders.
TLA Worldwide shares more than doubled in value on Thursday in London at 0.54 pence each, after closing on Wednesday at 0.25p. Earlier on the day, the shares jumped to the high of 0.58p.
