The bingo-to-casino group Rank admitted yesterday it would have to break up its loss-making Deluxe Media division and sell the assets separately after a prospective buyer for the whole business walked away and its book value was slashed.
The leisure group, whose chief executive Mike Smith is leaving this month, also disappointed investors with a 14 per cent fall in annual profits to £85.4m, a lower-than-expected cash return of £200m and a 50 per cent dividend cut. Rank announced a rebasing of its dividend after the recent £430m sale of its Deluxe Film business.
Rank, which runs Mecca bingo halls, Grosvenor casinos and Hard Rock cafes, has been trying for months to sell the Media business, which makes and distributes DVDs and CDs, and announced it had a preferred bidder in December. "That particular transaction has gone away," Mr Smith said yesterday. "There are likely to be several transactions." Rank wrote down the division yesterday by £80m to a negative value of £57m. The division has been seen as a poison pill deterring bidders for the group's leisure businesses.Reuse content