Granada claims under attack
Tuesday 19 December 1995
Granada's claims that its Sutcliffe contract catering business was significantly more profitable than that of the arch-rival Gardner Merchant group, recently sold by Forte, came under attack last night.
Garry Hawkes, chairman and chief executive of Gardner which is now owned by Sedexo of France and which Granada tried to buy, said the claims that "we were inefficient were just not true".
The boast about Sutcliffe was made by Alex Bernstein, chairman of Granada, which is trying to buy the Forte hotels group with a hostile pounds 3.3bn takeover bid.
In a press report last week, Mr Bernstein was attributed with saying: "When you have a business like Gardner Merchant, which is cash generative and is making a 3 per cent or 4 per cent return and your competitor is making 10 per cent, then why sell it before you get it up to 10 per cent as well?"
Mr Hawkes has written to each of Sutcliffe's 2,300 clients. In the letter, he said: "The profit margin at Gardner Merchant last year was 5.4 per cent which is more or less in line with the world's other major contract caterers. A 10 per cent margin, as now claimed by Sutcliffe, we believe to be unsustainable.
"We would need to double our profits on our current turnover of pounds 1.2bn to make a 10 per cent margin. This would require us to eliminate our entire cost base or raise our charges by 50 per cent to achieve this."
Mr Hawkes added: "We have written to Sutcliffe's clients saying they are paying too much."
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
Sony hack: Angelina Jolie branded 'seriously out of her mind' in further embarrassing leaked email saga
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
iJobs Money & Business
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...
$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...