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

PROMOTED VIDEO
News
Teeth should be brushed twice a day to prevent tooth decay
education
News
Bryan Cranston as Walter White, in the acclaimed series 'Breaking Bad'
news
Sport
footballChelsea 6 Maribor 0: Blues warm up for Premier League showdown with stroll in Champions League - but Mourinho is short of strikers
News
Those who were encouraged to walk in a happy manner remembered less negative words
science
Arts and Entertainment
Princess Olga in 'You Can't Get the Staff'
tvReview: The anachronistic aristocrats, it seemed, were just happy to have some attention
News
Renee Zellweger as Bridget Jones
i100
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
tech

Board creates magnetic field to achieve lift

News
There have been various incidents of social media users inadvertently flouting the law
news

Life and Style
Stack ‘em high?: quantity doesn’t always trump quality, as Friends of the Earth can testify
techThe proliferation of online petitions allows us to register our protests at the touch of a button. But do they change anything?
News
Bourgogne wine maker Laboure-Roi vice president Thibault Garin (L) offers the company's 2013 Beaujolais Nouveau wine to the guest in the wine spa at the Hakone Yunessun spa resort facilities in Hakone town, Kanagawa prefecture, some 100-kilometre west of Tokyo
i100
Sport
CSKA Moscow celebrate after equalising with a late penalty
footballCSKA Moscow 2 Manchester City 2: Premier League champions let two goal lead slip in Russia
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Helpdesk Analyst

£23000 per annum + pension and 22 days holiday: Ashdown Group: An established ...

Senior Helpdesk Analyst / Service Desk Co-ordinator

£27000 per annum + pension, 22 days holiday: Ashdown Group: An established ind...

Senior Pensions Administrator

£23000 - £26000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...

Corporate Actions Administrator / Operations Administrator

£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...

Day In a Page

Indiana serial killer? Man arrested for murdering teenage prostitute confesses to six other murders - and police fear there could be many more

A new American serial killer?

Police fear man arrested for murder of teen prostitute could be responsible for killing spree dating back 20 years
Sweetie, the fake 10-year-old girl designed to catch online predators, claims her first scalp

Sting to trap paedophiles may not carry weight in UK courts

Computer image of ‘Sweetie’ represented entrapment, experts say
Fukushima nuclear crisis: Evacuees still stuck in cramped emergency housing three years on - and may never return home

Return to Fukushima – a land they will never call home again

Evacuees still stuck in cramped emergency housing three years on from nuclear disaster
Wildlife Photographer of the Year: Intimate image of resting lions claims top prize

Wildlife Photographer of the Year

Intimate image of resting lions claims top prize
Online petitions: Sign here to change the world

Want to change the world? Just sign here

The proliferation of online petitions allows us to register our protests at the touch of a button. But do they change anything?
Ed Sheeran hits back after being labelled too boring to headline festivals

'You need me, I don’t need you'

Ed Sheeran hits back after being labelled too boring to headline festivals
How to Get Away with Murder: Shonda Rhimes reinvents the legal drama

How to Get Away with Murder

Shonda Rhimes reinvents the legal drama
A cup of tea is every worker's right

Hard to swallow

Three hospitals in Leicester have banned their staff from drinking tea and coffee in public areas. Christopher Hirst explains why he thinks that a cuppa is every worker's right
Which animals are nearly extinct?

Which animals are nearly extinct?

Conservationists in Kenya are in mourning after the death of a white northern rhino, which has left the species with a single male. These are the other species on the brink
12 best children's shoes

Perfect for leaf-kicking: 12 best children's shoes

Find footwear perfect to keep kids' feet protected this autumn
Anderlecht vs Arsenal: Gunners' ray of light Aaron Ramsey shines again

Arsenal’s ray of light ready to shine again

Aaron Ramsey’s injury record has prompted a club investigation. For now, the midfielder is just happy to be fit to face Anderlecht in the Champions League
Comment: David Moyes' show of sensitivity thrown back in his face by former Manchester United manager Sir Alex Ferguson

Moyes’ show of sensitivity thrown back in his face... by Ferguson

Manchester United legend tramples on successor who resisted criticising his inheritance
Two super-sized ships have cruised into British waters, but how big can these behemoths get?

Super-sized ships: How big can they get?

Two of the largest vessels in the world cruised into UK waters last week
British doctors on brink of 'cure' for paralysis with spinal cord treatment

British doctors on brink of cure for paralysis

Sufferers can now be offered the possibility of cure thanks to a revolutionary implant of regenerative cells
Ranked seventh in world’s best tourist cities - not London, or Edinburgh, but Salisbury

Lonely Planet’s Best in Travel 2015

UK city beats Vienna, Paris and New York to be ranked seventh in world’s best tourist destinations - but it's not London