Ashcroft to sell auction arm
Tuesday 16 May 1995
Michael Ashcroft, the colourful 1980s high-flyer who has been building a new reputation in America, is severing another link with Britain by selling his car auction business.
The chairman and chief executive of ADT, which is based in Bermuda but retains a UK quote, wants to channel more resources into the fast-growing US home security industry.
SG Warburg has been appointed to draw up a list of suitable purchasers for the auctions business, which operates in the UK and Continental Europe. Some of the UK's big car dealerships are expected to show close interest.
The operation, which Mr Ashcroft said earlier this year was ripe for expansion opportunities, ended the 12-months to 31 March 1995 with operating profits of $37m (£25m) on sales of $376m.
It leaves ADT with a very small home security business in the UK. A spokeswoman said she could not comment on whether the company would retain its London stock market quote.
In the 1980s Mr Ashcroft had a reputation as an unpredictable investor who built up strategic stakes in several companies. His secrecy, accounting techniques and share dealings alienated many in the City. Eventually he took his company to Bermuda, and while he still generates suspicion in London he has undergone something of a rehabilitation in the US.
Yesterday he said he wanted to concentrate ADT on electronic security services, principally in the US where it is the market leader with a 12.4 per cent share. The company, which was refinanced, said it would begin fresh negotiations with its principal bankers now that money from the sale would be coming into the group.
But the ADT statement added that the proposed divestment would, at current rates of interest, be marginally earnings-dilutive in the near term.The group also yesterday reported third-quarter pre-tax profits virtually unchanged at $27m, on turnover up from $336m to $373m.
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