Bock plans to sell off Lonrho's hotel interests

Dieter Bock took a further step towards a possible break-up of Lonrho yesterday as he confirmed that the mining and agriculture conglomerate planned to float off its wide-ranging hotel interests, possibly this year.

The move, which accompanied better-than-expected results for 1994, is certain to create a further rift with Roland "Tiny" Rowland, who was ousted from the board last November and is understood to be set against a flotation of the division.

Apart from the diversity of the group's interests, which include luxury American hotels, the Metropole chain in Britain and safari lodges in Kenya, another possible stumbling block to any flotation is expected to be the one-third stake held in the Metropole chain by the Libyan government.

Mr Rowland courted controversy in the wake of the Lockerbie bombing, when he raised £177m from Colonel Gaddafi, the Libyan leader, for the stake. He had bought the whole chain 12 years previously for less than £20m.

Mr Bock, who poured cold water on rumours that he is poised to sell up to half his 18.5 per cent holding in Lonrho, also said that flotation was an option being considered for the group's general trading operations, whose interests include motor and equipment trading and textiles.

The market was unsurprised by the decision to float parts of the Lonrho empire, which Mr Bock sees as a way of establishing a proper value for the group's assets. Although they are stated in the books at only 135p a share, Mr Bock and others in the City believe they could actually be worth more than 200p.

The expectation that Lonrho's hidden value might be realised now that Mr Rowland has been pushed upstairs to the position of president has led to a 20 per cent rise in the share price since the coup.

The day before Mr Rowland stepped down from the board after 34 years at Lonrho, the shares traded at 132.5p compared with a high of 300p in 1990. Yesterday they closed 2.5p higher at 158.8p.

As well as confirming that he would be holding on to the stake he bought two years ago, Mr Bock said he had no intention of buying Mr Rowland's remaining 6 per cent stake: "When I started at Lonrho I needed to have an influence. This is no longer necessary."

Underlying profits grew strongly during 1994, with a 56 per cent improvement at the pre-tax level from £72m to £112m. Including an £87m profit from business disposals in 1993 they fell from £165m. Earnings per share jumped from 1.9p to 6.6p and the dividend increased from 4p to 4.75p.

Mining, which generates about half the group's operating profits benefited from a 7 per cent rise in production from the recently floated Ashanti mines. The division is set to produce 1 million ounces of gold this year and costs remain low at $167 an ounce. The platinum division's profits were knocked by a 38 per cent decrease in the rhodium price but platinum volumes and prices both rose during the year.

The hotels division, which has 7,000 rooms in 19 hotels and seven Kenyan safari lodges, increased profits from £19m to £28m despite persistently low occupancy rates, notably in Mexico where political instability kept hotels two thirds empty.

The agriculture division, Africa's largest commercial food producer with operations in 11 countries covering 1 million acres, was boosted by its dominant sugar arm where profits grew 65 per cent to £28m.

Of the four core divisions, only general trade fell, from £33m to £21m, as its manufacturing activities turned a £4m profit into a £5m loss.

Outlook, this page

Susan Sarandon described David Bowie as
peopleSusan Sarandon reveals more on her David Bowie romance
Arsenal supporters gather for a recent ‘fan party’ in New Jersey
sportDidier Drogba returns to Chelsea on one-year deal
Arts and Entertainment
The Secret Cinema performance of Back to the Future has been cancelled again
Life and Style
Balmain's autumn/winter 2014 campaign, shot by Mario Sorrenti and featuring Binx Walton, Cara Delevingne, Jourdan Dunn, Ysaunny Brito, Issa Lish and Kayla Scott
fashionHow Olivier Rousteing is revitalising the house of Balmain
Arts and Entertainment
Christian Grey cradles Ana in the Fifty Shades of Grey film
filmFifty Shades of Grey trailer provokes moral outrage in US
BBC broadcaster and presenter Evan Davis, who will be taking over from Jeremy Paxman on Newsnight
peopleForget Paxman - what will Evan Davis be like on Newsnight?
Life and Style
fashionCustomer complained about the visibly protruding ribs
ebookA unique anthology of reporting and analysis of a crucial period of history
newsComedy club forced to apologise as maggots eating a dead pigeon fall out of air-conditioning
Arts and Entertainment
Jo Brand says she's mellowed a lot
tvJo Brand says shows encourage people to laugh at the vulnerable
Life and Style
People may feel that they're procrastinating by watching TV in the evening
Tovey says of homeless charity the Pillion Trust : 'If it weren't for them and the park attendant I wouldn't be here today.'
Rhys Williams
commonwealth games
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior Risk Manager - Banking - London - £650

£600 - £650 per day: Orgtel: Conduct Risk Liaison Manager - Banking - London -...

The benefits of being in Recruitment at SThree...

£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

Test Analyst - UAT - Credit Risk

£280 - £300 per day + competitive: Orgtel: Test Analyst, Edinburgh, Credit Ris...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Day In a Page

Evan Davis: The BBC’s wolf in sheep’s clothing to take over at Newsnight

The BBC’s wolf in sheep’s clothing

What will Evan Davis be like on Newsnight?
Finding the names for America’s shame: What happens to the immigrants crossing the US-Mexico border without documents who never make it past the Arizona desert?

Finding the names for America’s shame

The immigrants crossing the US-Mexico border without documents who never make it past the Arizona desert
Inside a church for Born Again Christians: Speaking to God in a Manchester multiplex

Inside a church for Born Again Christians

As Britain's Anglican church struggles to establish its modern identity, one branch of Christianity is booming
Rihanna, Kim Kardashian and me: How Olivier Rousteing is revitalising the house of Balmain

Olivier Rousteing is revitalising the house of Balmain

Parisian couturier Pierre Balmain made his name dressing the mid-century jet set. Today, Olivier Rousteing – heir to the house Pierre built – is celebrating their 21st-century equivalents. The result? Nothing short of Balmania
Cancer, cardiac arrest, HIV and homelessness - and he's only 39

Incredible survival story of David Tovey

Tovey went from cooking for the Queen to rifling through bins for his supper. His is a startling story of endurance against the odds – and of a social safety net failing at every turn
Backhanders, bribery and abuses of power have soared in China as economy surges

Bribery and abuses of power soar in China

The bribery is fuelled by the surge in China's economy but the rules of corruption are subtle and unspoken, finds Evan Osnos, as he learns the dark arts from a master
Commonwealth Games 2014: Highland terriers stole the show at the opening ceremony

Highland terriers steal the show at opening ceremony

Gillian Orr explores why a dog loved by film stars and presidents is finally having its day
German art world rocked as artists use renowned fat sculpture to distil schnapps

Brewing the fat from artwork angers widow of sculptor

Part of Joseph Beuys' 1982 sculpture 'Fettecke' used to distil schnapps
BBC's The Secret History of Our Streets reveals a fascinating window into Britain's past

BBC takes viewers back down memory lane

The Secret History of Our Streets, which returns with three films looking at Scottish streets, is the inverse of Benefits Street - delivering warmth instead of cynicism
Joe, film review: Nicolas Cage delivers an astonishing performance in low budget drama

Nicolas Cage shines in low-budget drama Joe

Cage plays an ex-con in David Gordon Green's independent drama, which has been adapted from a novel by Larry Brown
How to make your own gourmet ice lollies, granitas, slushy cocktails and frozen yoghurt

Make your own ice lollies and frozen yoghurt

Think outside the cool box for this summer's tempting frozen treats
Ford Fiesta is UK's most popular car of all-time, with sales topping 4.1 million since 1976

Fiesta is UK's most popular car of all-time

Sales have topped 4.1 million since 1976. To celebrate this milestone, four Independent writers recall their Fiestas with pride
10 best reed diffusers

Heaven scent: 10 best reed diffusers

Keep your rooms smelling summery and fresh with one of these subtle but distinctive home fragrances that’ll last you months
Commonwealth Games 2014: Female boxers set to compete for first time

Female boxers set to compete at Commonwealth Games for first time

There’s no favourites and with no headguards anything could happen
Five things we’ve learned so far about Manchester United under Louis van Gaal

Five things we’ve learned so far about United under Van Gaal

It’s impossible to avoid the impression that the Dutch manager is playing to the gallery a little