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Published on: July 17, 2023

LionFish sale completed

Last week, RBG announced the successful disposal of LionFish to Blackmead Infrastructure for a total consideration up to £3.06m. In our view, this materially simplifies the business and reduces its exposure to third-party litigation funding, which has detracted from the otherwise more stable underlying revenue and earnings profile of the group. The LionFish disposal strengthens the balance sheet, enabling the new board to focus on driving the high-margin, cash-generative legal and professional services group. We maintain our estimates for FY23 and note that RBG continues to trade at a discount to its peer group, despite sector-leading margins and a forecast 18% dividend yield. With the LionFish disposal successfully completed, alongside positive sector newsflow, we expect the shares to re-rate.

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