Founder supports Reject Shop bid

BY NIGEL COPE

Anna Vinton, founder and former chief executive of the Reject Shop furniture chain, which collapsed into receivership last month, is supporting a management group trying to buy the business from the receiver.

Ms Vinton's involvement is certain to cause controversy as she and four other former Reject Shop directors are currently being sued by Upton & Southern, the department store group that bought Reject Shop for pounds 2.3m in February 1994.

The writs, issued last October, allege the Reject Shop directors misrepresented the value of stocks and liabilities and did not give a true and fair view of the state of the business. The directors are contesting the action.

Ms Vinton is supporting a management buyout led by the former Reject Shop managing director, David Taylor, to buy the 31-strong chain of furniture shops, which failed with debts of pounds 8m. The receivers, Grant Thornton, expect to announce a buyer this week, although the chain is not expected to fetch much more than pounds 2m.

If a management buyout succeeded, Ms Vinton would have little problem raising finance for the deal. She has significant funds from the Reject Shop sale, and her husband, Fred Vinton, is chairman of Electra Kingsway, the venture capital group.

Anna Vinton was not available yesterday, but Mr Vinton said: "We've talked about helping David, but our support is of a general nature. My wife knows him and thinks well of him. When you've been with a business for 23 years, you have an emotional attachment to it."

Despite Ms Vinton's enthusiasm for a deal, it is understood the management buyout is not the favoured candidate for the chain. The two front runners are consortiums from the UK and US.

If a buyer for the whole group cannot be found, Jerry's Home Store, a privately owned group of three upmarket furniture and housewares stores, says it would be interested in certain Reject Shop locations. The Pier, an American chain of furniture stores which moved into Britain three years ago, says it might be interested in cherry picking. Habitat has ruled itself out, saying it prefers organic growth to acquisition.