Eurocopy sends suitors away

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The Independent Online
NIGEL COPE

Eurocopy, the photocopier group that announced it was in bid talks in August, called off all discussions with potential bidders yesterday.

The company said it had not proved possible to reach a deal that was satisfactory to the chairman, Cyril Gay, and his family, who still control more than 50 per cent of the shares. Eurocopy's shares fell 6p to 77p on the news.

The company said it now intended to return to its policy of growth by acquisition in the rapidly polarising market. It will also expand its sales force. Mr Gay, who is chairman and chief executive, will devote his time to strategy and business development.

Mike McCarney has been appointed managing director from 1 December and will be responsible for day to day operations for the company. Mr McCarney joined Eurocopy five years ago from FKI, the engineering company.

When Eurocopy announced it was in preliminary discussions that could lead to an offer, the two groups thought to be involved were Alco Standard Corp of the US and Ricoh, the Japanese group. The announcement then flushed out several other bidders.

But as talks dragged on, shareholders expressed doubts they would lead to a bid. The negotiations became even more protracted when Eurocopy changed its advisers half-way though.

Matthew Burton, finance director, said yesterday that in the interest of other shareholders Mr Gay would listen to anyone who wanted to talk about an offer for the company, though the family's majority stake rules out a hostile bid.

Eurocopy is the last independent quoted office equipment company in the UK. The market has been subject to a wave of takeover activity in recent months. Alco Standard and Danka Businesses Systems, also of the US, have been expanding quickly in the UK.

In April, Alco beat Danka for control of Southern Business Group for pounds 81m. In July it acquired Copymore for pounds 23.5m. Ricoh paid pounds 179m for Gestetner in the same month. Other groups, such as Cardinal Businesses Group, formerly known as Berkeley Business Systems, and Eurocopy itself have also been expanding.

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