Sorted Group to Sell Main Subsidiary for £1 and Become AIM Cash Shell

Location Sciences Group Plc ( (GB:SORT) ) has shared an update.

Sorted Group Holdings plans to sell its main operating subsidiary, Sorted Group Limited, for a nominal £1, alongside a debt restructuring that will see lenders and group companies release the loss-making unit from liabilities, including £3.52 million owed to Shard. The disposal, subject to shareholder approval at a 20 April general meeting and completion conditions, reflects the board’s view that further heavy investment in the SaaS logistics business is not in shareholders’ best interests and that employees’ prospects are better under the buyer.

On completion, the company will change its name to SGH plc and become an AIM Rule 15 cash shell with no operating cash flows, required within six months to complete a reverse takeover or become an investing company to avoid suspension and potential cancellation from AIM. The debt restructuring constitutes a related-party transaction due to a major shareholder’s involvement, which independent directors, after consulting the nominated adviser, have deemed fair and reasonable, and the board intends to liquidate Sorted Holdings Limited after the disposal while seeking new acquisition opportunities.

The most recent analyst rating on (GB:SORT) stock is a Sell with a £23.50 price target. To see the full list of analyst forecasts on Location Sciences Group Plc stock, see the GB:SORT Stock Forecast page.

Spark’s Take on SORT Stock

According to Spark, TipRanks’ AI Analyst, SORT is a Underperform.

The overall stock score is primarily driven by significant financial performance concerns, including high leverage and negative profitability margins. Technical analysis indicates bearish momentum, with the stock being oversold. The valuation is unattractive due to a negative P/E ratio and lack of dividend yield. These factors collectively suggest caution for potential investors.

To see Spark’s full report on SORT stock, click here.

More about Location Sciences Group Plc

Sorted Group Holdings Plc, quoted on AIM, operates in the software-as-a-service logistics and delivery management sector through its Sorted platform. The business has historically focused on technology for retailers and other clients, but remains in a growth phase, consuming significant cash and requiring substantial further investment to reach profitability.

Average Trading Volume: 10,910

Technical Sentiment Signal: Strong Sell

Current Market Cap: £1.53M

See more insights into SORT stock on TipRanks’ Stock Analysis page.