Bottom Line: Six months on, time is running out for Brent Walker

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The Independent Online
SIR KEITH BRIGHT, the former head of London Underground, has been chairman of Brent Walker for six months. He was brought in because the company's banks were unhappy with Ken Scobie, the man they had brought in because they were unhappy with the management, which they brought in when they kicked out George Walker.

Sir Keith said he would take some time to get to know the business and then come up with a strategic plan to take the group forward within a few months. Six should have been enough.

The word from Brent Walker is that Sir Keith is putting the final touches to the first draft of a business plan. Meanwhile, Brent Walker appears to be operating as three separate entities - the bookmaking arm, the pub-owning arm and the rest - and the vultures are circling to see if they can force the group into letting go of its few valuable assets cheaply.

Consider the events of the last few days. First it emerged that a consortium of venture capitalists led by SG Warburg had approached Brent Walker with a pounds 350m bid for the bookmaker William Hill. This was turned down - not surprisingly, as it worked out at less than 11 times after-tax earnings and the company cost pounds 650m to buy.

Then it was suggested that William Hill might be floated. But the bookmaker must refinance pounds 320m of debts, which are secured on its assets, by March next year. Unless a flotation can realise much more than the Warburg offer, Brent Walker could end up getting rid of one of its main assets and receiving little in return.

Yesterday Brent Walker announced it was closing Elstree studios (hands up all those who remembered it still owned Elstree Studios) as this was losing nearly pounds 1m a year. But it may still have to pay pounds 10m to the local council for the pleasure of redeveloping the site.

All this came on top of the astounding pounds 240m write-down of the pub estate, which had to be revalued less than a year after the group completed its pounds 1.4bn bank refinancing.

The banks that agreed to refinance the group's debts rather than put it into receivership must be wondering why they bothered.

Sir Keith must act soon and decisively. The current position makes the shares, down 1/2 p to 7 3/4 p yesterday, look overpriced.

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