Ascential mulling group break up

Information and data company Ascential on Monday confirmed it was considering a break-up of the group.

The announcement came after a Sky News report citing unnamed sources as saying that Ascential, which has a market capitalisation of £1.49bn, is working with investment bankers on plans to demerge its digital operations and list them separately in the US.

“Ascential confirms that it is in the early stages of evaluating the merits of a managed separation of certain assets of the group,” the company said in a statement.

“As discussions are exploratory at this stage, they may or may not lead to the board making a decision to undertake a managed separation of these businesses in due course.”

Under the plans Ascential’s events operations - which include the Cannes Lions and World Retail Congress - would remain listed in London, the Sky report stated.

Ascential describes itself as a "specialist information, analytics and e-commerce optimisation company".

Analysts at Shore Capital said Ascential was a "well-managed company with an increasingly compelling digital commerce offering and the potential for its marketing division to bounce back strongly".

"As things stand, we estimate three-year aggregate earnings per share growth of 96%, a sharp rebound in dividend per share (starting this year) and strong underlying cash generation which we do not believe is reflected in its stock valuation."

"We await further developments with interest, although would characterise 'Ascential excluding Digital' as a significantly less attractive business for shareholders that are unable to hold US listed assets. The attractions of such a deal for them would therefore very much depend on the exit multiple secured for its higher growth assets. In the meantime, we maintain our 'buy' recommendation."