Healthcare-focused media and public relations agency Stagwell (STGW -2.06%) managed to generate its own positive publicity on Wednesday. The company announced a large asset sale, and investors were pleased with the news as evidenced by the stock's nearly 20% rise across that trading day. This made it something of a standout on a day when the gloomy S&P 500 index declined by 1.4%.
Stagwell unloads ConcentricLife for a pretty penny
That afternoon, Stagwell announced that it agreed to sell ConcentricLife, its marketing agency and pharmaceutical-commercialization vehicle, to consultancy Accenture. The ultimate recipient will be the latter company's Accenture Song creative unit, and the price is $245 million in cash.
The move is part of a slimming and consolidation effort by Stagwell. Under this strategy, it will narrow its focus to its core digital services.
In the press release trumpeting the deal, Stagwell quoted its CEO Mark Benn as saying that "We believe Accenture Song will be a good home for ConcentricLife, consistent with their focus on growing presence in the healthcare and life sciences industry."
At the very least, the sale will make a sudden and drastic change in Stagwell's cash position. At the end of June, it held $105 million in cash on its books. The incoming monies will more than triple that amount.
When the sale will close is anyone's guess, however
The closing of the ConcentricLife deal is subject to approval from the relevant regulatory bodies. Stagwell did not provide an estimate about when the closing might occur.
