Deal expected to complete next month

Dobbie’s Castle Street in talks to acquire IT company

Bill DobbieCastle Street Investments , the company formed out of the now defunct Edinburgh online dating service Cupid, is in talks to acquire an undisclosed IT business.

Shares in Castle Street, chaired by the entrepreneur Bill Dobbie (pictured), were suspended on the Alternative Investment Market today as discussions continued.

The deal, if completed, would constitute a reverse takeover of the IT managed services company and will mean introducing a new management team to lead the enlarged group.

The acquisition is of a size that would require a placing of new Castle Street shares to supplement its existing cash resources in order to meet the cash acquisition price and also provide additional capital to implement the group’s growth plan.

In a statement to the London Stock Exchange, the company – based in Castle Street, Edinburgh – has continued to make good progress in closing out its trading liabilities, as well as collecting the final deferred payment from Grendall, the British Virgin Islands firm owned by Cupid co-founder Max Polyakov, in respect of the disposal of the company’s casual dating business in 2013.

As a result, the company’s closing cash position at the end of December 2015, net of liabilities, is expected to be in excess of £22 million (representing 31p per share). Distributable reserves are expected to be in excess of £21.5m.

It is now a year since the company became an investing company and trading in the company’s shares has today been suspended at the company’s request pending completion of the acquisition.

It is expected that definitive terms will be agreed during January. However, the company says there can be no certainty at this stage either that it will complete.

In the event that the acquisition does not complete, the company will then, in line with its investing policy, bring forward proposals to return surplus cash to shareholders.

Mr Dobbie is a serial investor who also chairs the crowdlending company LendingCrowd and was co-founder of the cloud company Iomart.

He launched Cupid with Mr Polyakov with 2010 and floated it a year later and it grew quickly, acquiring businesses such as  It was the UK’s only listed online dating firm and its value soared to £180m before quickly falling to earth as new style dating services such as Tinder moved into the market.

The board sold its “casual dating” business – which also included websites such as and – to Mr Polyakov in a deal worth £45.1m.

Phil Gripton, previously head of Edinburgh-based online marketing firm Bigmouthmedia, succeeded him as chief executive and it pulled out of dating services and last year turned itself into a shell investment vehicle.

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