Scoot.com sacrifices Loot to keep afloat

If ever an acquisition was an error of judgement...

Scoot.com has confirmed that DMG Niche Publications is to buy its free ads newspaper Loot for £45m. The sale represents a massive depreciation of value for the classified advertising venture. Scoot bought the business for £190m around 15 months ago and subsequently predicted that it would generate annual revenues of £20m from the operation. Scoot has seen its share price plummet this year and recently announced it was unable to find the funds necessary to continue its loss-making operations. Scoot is now to be provided with a bridging loan of £10.5m under the terms of this latest deal which will enable it to repay debts and continue trading at least until October. DMG is a subsidiary of the Daily Mail and General Trust and the deal must now be cleared by Scoot's shareholders and approved by the Irish competition regulators.