Jun 29, 2018

TalkTalk shares slide after Daisy deal collapses

TalkTalk's plan to sell its direct business unit to Daisy Group has collapsed, sending shares in the broadband provider to a four-month low. TalkTalk in May said it had agreed to sell the unit, which serves 80,000 business customers, to Daisy for £175m. The sale would have raised cash to strengthen its balance sheet and allowed it to concentrate on providing capacity to its network of 800 resellers, including Daisy, in the enterprise market. Daisy had conducted due diligence, in tandem with Deloitte, on the TalkTalk business since May, but the two companies scrapped the deal this week after failing to agree final terms. One person with direct knowledge of the talks said it was "Abnormal" for Daisy to pull out of a deal without a good reason. TalkTalk shares fell as much as 10.9 per cent on Friday's news but recovered to close 2.7 per cent lower at 103.25p. The company reiterated that its earnings before interest, taxation, depreciation and amortisation for the 2019 financial year would grow by 15 per cent from £233m in the previous year.

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