Hyve to dispose of Russian assets, sales bounce back post-Covid
Exhibitions giant Hyve Group — which runs Pure London and Spring/Autumn Fair — is to sell its Russian business, citing the ongoing war in Ukraine.
The global events organiser also cited “significant challenges from a moral, legal, compliance, and operational standpoint that would arise from continuing to operate in Russia”.
It will sell the subsidiary to Rise Expo Limited for a maximum cash consideration of £72 million payable over a 10-year period. Hyve said the disposal is conditional on the approval of its shareholders, lenders and regulators.
In a statement, Hyve said: “The decision considered feedback from a number of stakeholders, including several customers of events outside of Russia. These customers had expressed material concerns relating to any ongoing activities by the company in Russia, with an indication of boycotts of the company's Western events.”
Additional concerns included “the risk of expropriation or a fraudulent business sale in the current political environment; Increasing risks (under Russian law) for local management from compliance with increased international sanctions versus potential criminal liability (under international sanctions and money laundering laws) for the rest of Hyve's companies, directors and employees from continued involvement with the Russian Business”.
Hyve "expects to report a loss on disposal of its Russian business as a result of the transaction. Further details will be provided at the time of publication of the circular", it added.
“The decision was not taken lightly, however the sale of the Russian business will allow Hyve management to focus more clearly on growth opportunities in the US and Western Europe.”
The news of the disposal coincided with its results for the six months ended 31 March that showed a major leap in revenues, given the reopening of events across the world, post-pandemic.
The group said it has delivered revenue of around £58 million in the first half, up from just £5 million a year ago, excluding Russian revenues of around £17 million. It said the gains were underpinned by “the reopening of western markets and strong performance across all key performance indicators, including like-for-like customer spend, visitor density and NPS”.
In the UK, it said Spring Fair built on the momentum created at Autumn Fair last year.
Meanwhile, forward bookings for the full year are currently £103 million (excluding bookings for Russian and Ukrainian events), “demonstrating the continued realisation of pent-up demand for in-person events as key shows return, enhanced by the ongoing execution of the group’s omnichannel strategy, and despite continued Covid-19 disruption in some geographies and challenges across the wider geopolitical environment”.
Mark Shashoua, CEO of Hyve Group plc said: "I am delighted to see Hyve return to a schedule of events comparable to pre-pandemic levels and I am highly encouraged by the pent-up demand we continue to see among our customer communities.
“In parallel, we have continued to roll out our facilitated meetings product across our portfolio, including Spring Fair, with further rollouts planned for the second half of the year.
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