City File: Arrival signals reduction

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ONE company not happy to see Kenneth Clarke at 11 Downing Street is De La Rue, the security printing and banknotes group. The City has decided that Mr Clarke's arrival signals another 1/2 per cent reduction in interest rates - which would cut pounds 7m from De La Rue's profits for this year.

The company has the enviable problem of pounds 140m of cash in its balance sheet which it is finding difficult to spend. Jonathan Helliwell at James Capel expects De La Rue to buy a payment systems company to fit in with its Inter Innovation subsidiary. But the right purchases do not grow on trees.