Flotation to open a new chapter for Books etc
Tuesday 26 August 1997
Richard Joseph, who founded Books etc with his father Philip Joseph in 1981, said yesterday the full listing would raise pounds 5m-pounds 7m in new money and value the business at pounds 30m -pounds 40m.
"We believe there is a lot more consolidation to come in the book-selling business, and the flotation will give us the ability to make acquisitions when the opportunities arise," Mr Joseph said.
He will become chairman and chief executive of the company while Nigel Whittaker, a former director of Kingfisher, will become non-executive deputy chairman. The placing to institutions will also enable the company to expand further outside the South-east where its 20 stores are concentrated.
Mr Joseph aims to open 14 more shops over the next four years including stores in Manchester and Edinburgh.
In the year to 31 January 1997 the company made a pre-tax profit of pounds 2.2m on turnover of pounds 31.15m. Mr Joseph is confident the company can pursue rapid growth. "We have a good name in London, and we have invested a lot in systems and people," he says. He points out that the UK book market is worth around pounds 3.2bn and is forecast to grow at 5 per cent a year for the foreseeable future. Independent retail chains account for 21 per cent of the market.
Charterhouse Tilney Securities has been appointed sponsor and stockbroker to the float. Mark Sebba, a former director of Charterhouse bank and finance director of Golden Rose Communications, will also join the board as a non-executive director.
Selling books runs in the family, according to Mr Joseph. His father Philip used to run Exclusive Books, a shop chain in South Africa which is still going strong. Joseph senior will retire as chairman of Books etc following the float and will become a non-executive director.
The company prides itself on being innovative, says Mr Joseph. He claims it was one of the first UK booksellers to adopt a "lifestyle retailing concept" into its stores. This included introducing coffee shops in 1994 as well as extended browsing areas and a "money-back guarantee".
He says Books etc was also the first specialist chain to identify the potential of airports for successful book selling. The group operates three airport stores.
Ten years ago Hambro Group Investments took a 30 per cent stake to help the business grow. Under the flotation plan John May, managing director of Hambro Group Investments, will join the board as a non-executive director.
Mr Joseph dismisses the threat of competition from Internet-based book sellers, a number of which have been launched and floated recently.
"Most people who buy books want to see and feel them and read a chapter first before they buy them."
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