The arrival of new shareholders, four of whom have secured places on the board, prompted the resignation of Arlen's chief executive, Paul Cohen. He is thought to have favoured disposals rather than a cash injection to solve the group's financial problems.
Maintaining a nominal link with its previous incarnation, the management team now operates as Fortress Trust. It includes Nicholas Berry, who recently ended a long-running dispute by agreeing to sell his minority stake in Manchester Ship Canal to Peel Holdings.
Fortress plans to take a 29.9 per cent stake in Arlen by underwriting a one-for-one rights issue to raise pounds 6.7m. Ultimately it intends to reduce its holding to about 25 per cent by placing shares with institutions.
It is understood that Fortress will use Arlen to expand over the next few years. Keep Trust grew into a diversified motor distribution, service, hire and leasing business during its nine- year existence.
Despite disposals and closures, Arlen remains highly borrowed. Including an issue of preference shares, which will be repaid with pounds 2.9m of the proceeds, gearing stands at 109 per cent.
Arlen also announced a return to the black in the year to March. On reduced turnover of pounds 32.2m (pounds 34m) the company struck pre-tax profits of pounds 719,000 following an pounds 884,000 loss. Earnings per share were 1.1p (3.8p loss) and there was no dividend.Reuse content