Former Tiphook in talks with banks

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The Independent Online
(First Edition)

CENTRAL Transport Rental Group, the troubled container leasing company formerly named Tiphook, is talking to its banks about the possibility of going into administration in an attempt to rescue the group from losses last year of pounds 330m and debts of pounds 535m.

Robert Montague, chief executive, is himself fighting a bankruptcy petition from Royal Bank of Scotland for personal debts of pounds 2.3m. Yesterday a trust in which Mr Montague has a beneficial interest sold 434,398 Tiphook shares at 33p, raising just over pounds 143,000.

Mr Montague is in New York putting Tiphook's case to representatives of US bondholders who are owed more than pounds 500m. The bondholders have brought a class action against Tiphook and some of its directors, alleging that investors were mislead during the issue of the bonds in 1992 and 1993 before the emergence of commercial problems in the group.

One source said: 'A lot of balls are up in the air at the moment. A lot depends on what Mr Montague says and how he says it.'

Insolvency specialists from Coopers & Lybrand have been keeping an eye on Tiphook on behalf of its banks, led by National Westminster, and would be in line to become adminsitrators if that route were chosen. Administration would protect Tiphook from its creditors while it refinances and restructures itself. The US bondholders, for instance, favour a debt-for-equity swap.

Mr Montague is set to return to London on Thursday, when Royal Bank of Scotland intends to serve its bankruptcy writ on him. A bankruptcy hearing has been set for 28 October.

Commerzbank, Barclays and Lloyds also have significant exposures to Tiphook. The company sold its container businesses earlier this year for pounds 734m, leaving it with a net worth of pounds 33m and two divisions, trailer rental and railway rental and leasing.

A spokesman for Tiphook said the US litigation would be contested vigorously, but had no comment on the administration talks.

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