Shares in beleaguered five-a-side football centre operator Goals Soccer Centres (GOAL:AIM) rise 2.6% to 137.5p on news Sports Direct International (SPD) has taken a 4.89% equity stake in the stock.
Analysts suggest the move could be a precursor to a bid or lead to discussions about sponsorships and concessions within the business.
It comes after a string of profit warnings from the £77.5 million cap. On 9 November Goals said challenging summer trading meant full-year pre-tax profit would be between £8.2 million and £8.6 million instead of September’s guidance of £9.3 million to £9.8 million.
Goals suffered from the poor British weather this summer and a harsh winter in January, both of which led to players cancelling matches, and its annual September marketing campaign hasn’t been as effective as it hoped.
The last bid for Goals was the failed attempt by Ontario Teachers’ Pension Plan in August 2012. Goals recommended the £73 million takeover bit but the 144p-per-share offer was rejected by shareholders.
N+1 Singer analyst Sahill Shan says he wouldn’t dismiss the possibility of a corporate take-out by Sports Direct, given that the latter has been getting more involved in the sports and health market, for example by acquiring 10 assets from LA Fitness earlier in the year.
Shan has upgraded Goals from a ‘sell’ to a ‘buy’ rating and increased the target price from 120p to 150p, implying 9% upside.
