A rag trade to riches story as business is sold for pounds 50m

A NORTH London member of the rag trade who bought into an unpromising supplier of braids and trimmings for pounds 10,000 in 1978, today finds himself pounds 30m richer as he sells on the company to Mercury Asset Management for more than pounds 50m.

Peter Shalson is expected to realise over pounds 30m after selling his majority stake in Braitrim, an international supplier of packaging and accessories to the retail fashion industry.

When Mr Shalson bought into Braitrim, the company had been going for 18 years as a supplier of braids and trimmings to the London rag trade. Its turnover was less than half a million pounds a year.

Mr Shalson's first big break came when he engineered an expansion into clothes hangers. It turned out to be a lucrative niche. The business took off in the 1980s with a further expansion into packaging, labels and other shop accessories. By 1997, Braitrim's turnover had leapt to more than pounds 60m.

The company has successfully sold abroad and kept a tight rein on costs by striking up partnership deals with local manufacturers and distributors.

Mercury Asset Management, the City fund manager, yesterday bought an 80 per cent stake and injected fresh capital into the company for further expansion. The deal is worth well in excess of pounds 50m.

Peter Shalson will hang on to a minority stake in the company that made him rich but plans to take a back seat as a non-executive director. He said: "I think what I'll do now is take it easy for a few months - in between partying.

"Deciding to relinquish control of the business was not easy, but the directors and I felt that Mercury they were the best people to take the business forward in the interests of the employees, customers and suppliers."