Tribal ends bid talks

2nd Nov 2010 13:08

Public sector services provider Tribal Group says that it has ended talks with a potential bidder. Tribal admitted back in August that it had received a bid approach. The share price has fallen below the level prior to the announcement of bid talks. That is mainly down to last month's profit warning. Reduced demand for advisory work and delayed decisions by the government hit revenues. Tribal warned that pre-tax profit for 2010 would be substantially below the then expectations. Analysts expect a full year profit of £6m - less than one-half of last year's underling profit. Tribal has been selling off non-core operations. Most recently, it sold PR agency Kindred to its management for £1. Tribal had to provide £605,000 to the buyer as part of the deal. It may even provide up to £190,000 more by next May. Excluding balance sheet write-offs, Kindred lost around £600,000 in 2009 and things have got worse since the May general election.