Directors make a fortune from ruins of Coloroll: Denby Pottery ready to go public in pounds 40m flotation
Monday 25 April 1994
Denby, which makes stoneware in Derbyshire, was bought by John Ashcroft's fast-expanding home furnishings group in 1987. Stephen Riley, the managing director, was hired from Reckitt and Colman, and said the company 'benefited enormously' from its new owner, which invested pounds 3m in it. By 1989 Coloroll was, however starting to interfere, insisting on adding its name to Denby's long-established brand.
Mr Riley proposed a buyout, which was rejected. But when Coloroll went into receivership in June 1990, he was able to revive the deal rapidly and the buyout, the first of seven from Coloroll, was completed the next month. The highly leveraged pounds 6m deal was structured to give Mr Riley and three other managers 55 per cent of the equity, while 3i held the rest.
'It was one of those things which seemed like a tough deal at the time,' Mr Riley said yesterday. Within six months of the buyout, Denby's big retail customers had frozen their orders, following a disastrous Christmas, and the company went on to four-day working. But customer demand for the fashionable product continued to grow. 'We've never caught up with demand again,' Mr Riley said.
Denby has invested pounds 7m since the buyout, turnover has increased from pounds 9.7m to pounds 20m, and the workforce has grown from 390 to 650. Pre-tax profit in the year to last September was pounds 2.76m.
The directors and 3i are likely to sell half their stake in the flotation, which will consist of a public offer and a placing. The flotation will raise pounds 10m to pay off debts and fund new investment. Denby's brokers are Societe Generale Strauss Turnbull.
Mr Riley said the company would continue to expand in the US, where it has sales of dollars 2m (pounds 1.4m), and there may be acquisitions in the medium term. But, he said, 'the Coloroll experience will make us a lot more cautious'.
- 1 Woman accidentally shoots herself in the head while posing for a selfie
- 2 Art Garfunkel: Paul Simon is a 'monster' with a Napoleon complex
- 3 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 4 Female Muay Thai champion hustles coaches to give them a beating
Isis 'jihadi bride' claims forced sex with Yazidi girls is never rape because Koran condones it
Woman accidentally shoots herself in the head while posing for a selfie
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...