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Top story
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CFS and Britannia confirm merger
In a strong message to the ailing banking sector, Britannia Building Society and Co-operative Financial Services (CFS) have agreed a merger that will create one of the largest customer-owned financial services businesses in the UK. The new operation will combine £70bn of assets, nine million customers and 12,000 employees and will be led by Britannia group chief executive Neville Richardson. Following the integration of the two businesses current CFS chief executive David Anderson will leave the business. He said: “Owing to the damage done by the credit crunch, people have been crying out for a new way of doing business with a financial organisation of substance that truly has their interests at heart.” The deal has been allowed under new legislation, expected to become effective in the summer, which will allow the merger of a consumer co-operative and building society for the first time. The news follows the takeover by Nationwide of smaller building societies the Cheshire and Derbyshire, as banks and building societies look to strengthen in the current climate.
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Deals
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Investor backs generator company
Manchester-based investment company CorpAcq has acquired a 50 per stake in Mather & Stuart, a generator hire businesses based in Wigan. The business supplies large commercial projects including projects allied to the investment in infrastructure for the 2012 Olympics. Jackson Stephen advised Mather & Stuart, senior debt funding was provided by the Co-operative Bank and Royal Bank Invoice Finance. CorpAcq is run by Simon Orange, brother of Take That’s Jason Orange.
Trefick takes 21 per cent of Lookers
Isle of Man-based investment group Trefick has acquired a 21 per cent stake in Manchester car dealership Lookers. Amid turmoil in the sector and a slump in sales, Lookers is trading at 29p against a price of 88p a year ago. In December it said 2008 profits would not be less than £10m but the board would not recommend the payment of a final dividend. Although the national new car market has declined, Lookers continues to grow its after-sales business, while sales of used cars continue to recover, albeit below the levels seen a year ago.
Service Source sells stake
Service Source Europe, a Warrington-based distributor of IT equipment, has sold a 75 per cent stake in the company to industry rival Acal. The £1.85m transaction will see the company operate as part of Acal Supply Chain, a newly incorporated subsidiary of Acal. Service Source Europe was formed last year through a management buyout of Flextronics.
Asset-based lending comes out fighting
The latest research from the Asset Based Finance Association has found that increasing numbers of distressed firms across the country are looking to raise funds against their assets to survive the downturn. Over 60 per cent of those surveyed saw asset-based lending as strong in the current climate for offering a facility by which to “sweat” idle assets. Mark Shackleton, regional director of KBC Business Capital, told Insider: “We’ve got plenty on the go and I expect this to increase as the year goes on and the banks start to look at refinancing problem companies.” Under the Basel II regulations asset-based lenders are required to carry less capital behind their investments than traditional lenders, making it a more viable financing option in the current climate.
Recycling ripe for consolidation
Consolidation is the key to saving North West recycling firms, says Chris Froggatt at corporate finance house Ford Campbell. Froggatt said volatility in world commodity prices has left many operations in the sector struggling. He added: “There are a huge number of companies that are asset-rich but cash-poor and locked in three-year fixed price contracts negotiated at the height of the boom. Many of these companies are willing to sell and for businesses with strong balance sheets there are some excellent bargains out there. Newly merged companies will then have greater powers to renegotiate fixed-price contracts with suppliers and create a leaner, fitter business attractive to buyers.”
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Business
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Be bold urges China-Britain Business Council
North West companies are being encouraged to explore the opportunities offered by regional cities in China to help combat the worst of the economic downturn in the UK. The Think China, Act Regional event, organised by the China-Britain Business Council (CBBC) and HSBC in Manchester this morning, outlined 35 regional cities with promise. Chen Wu, assistant director of the CBBC, said that as competition is intensifying in Beijing and Shanghai, businesses should look to emerging markets like Dongguan and Shenyang. “The region’s companies need to take bold actions and seize the opportunities available - or competing markets around the world will do so," he said. "We need to build on existing links through the twinning of Manchester and Wuhan, and Liverpool and Shanghai.” CBBC and HSBC has organised a trade mission to China between 25 February and 7 March.
Insolvencies keep Begbies busy
Corporate recovery specialist Begbies Traynor has released its interim results for the six months to the end of October 2008. The Manchester-headquartered firm said revenue was up 37 per cent to £28.3m, while pre-tax profit remained unchanged at £2.1m, although after adjustment for one-off costs profit was up 31 per cent to £3.3m. Although the corporate finance arm of the business lost £1m over the six months, executive chairman Ric Traynor said that “actions are in place to mitigate the corporate finance losses”.
Ronnie suspended by JJB
Chris Ronnie has been suspended from his duties as chief executive of JJB Sports, the Wigan retailer yesterday confirmed. The company said it had suspended Ronnie “pending the outcome of an ongoing investigation being conducted by legal advisers into certain matters”. A further announcement will be made in due course.
Festive cheer for Moorhouse’s
Buoyant Burnley brewer Moorhouse’s has reported record Christmas trading, with volumes up 18 per cent. Managing director David Grant said: “Pubs faced the impact of the economic crisis and the festive season was particularly challenging. But our experience indicates that quality cask ale still sells well. For the second year our TV ad campaign captured the attention of both free trade licensees and discerning drinkers alike to stimulate demand.” Work will start this month on a £3.5m brewery development.
Amaze wins Blackpool brief
Manchester-based Amaze PR has been awarded the brief of urban regeneration company ReBlackpool. Amaze, which won a six-way pitch for the work, was formed by the merger of three Hasgrove-owned businesses: Connectpoint, which worked on Manchester’s Transport Innovation Fund bid; Amaze Europe; and Pavilion. ReBlackpool, chaired by Sir Howard Bernstein and led by chief executive Doug Garrett, has started a range of projects since losing out on the supercasino.
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Property
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Oddfellows’ fit-out complete
Warrington-based Claremont Group Interiors has completed the design and furniture contract for Oddfellows’ new 10,000 sq ft office at the newly refurbished Abbey House on Booth Street in Manchester city centre. Oddfellows, the not-for-profit national welfare society, has moved from its Fountain Street premises after its lease expired.
Knight Frank announces ratings wins
Knight Frank’s North West rating team has been appointed by developer St Modwen to provide advice on reducing its empty business rates liabilities. The firm has also announced that it is now working for eight colleges across the region including Preston and Liverpool Community College.
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Events
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Vote now for Manchester’s young professionals
Nominations are still open for this year’s Young Professional Awards, Insider’s annual search for leading professionals aged 35 and under in a variety of professional Greater Manchester organisations. The awards, to be held on 23 April at The Lowry Hotel, in association with Pro.Manchester, features nine categories: accountant, banker and financier, dealmaker, entrepreneur in professional services, lawyer, marketing and media, property, stockbroker or financial adviser, and a special contribution award. Click here to nominate and to book a table at the event click here. For further information, please contact Lucie Knight on 0161 907 9741 or lucie.knight@newsco.com.
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