LONDON (ShareCast) - Character animation software firm DA Group has ended bid talks and entered into a non-binding heads of agreement for the sale of its operating activities including its principal trading subsidiary for £500,000 in cash.

The group said that following settlement of transaction costs, it expects to retain net proceeds of around £200,000.

Discussions with regard to a potential offer for the company have also been terminated, it added.

But the firm asked for its shares to be suspended immediately as if the sale does not proceed, and on the basis of current cash flow forecasts, it believes the group will have insufficient funds to meet its liabilities as they fall due by the end of October.

• News Channel