Gus Carter takes flutter for £3.5m

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The Independent Online
Gus Carter, a 72-strong betting shop chain based in Sunderland, is raising £3.5m through a placing and full listing next month to fund acquisitions and improve systems.

Stockbrokers Wise Speke will publish the pathfinder prospectus today and first dealings in its shares will be on 9 May.

The firm has been built over the last 30 years by the Trewhitt family, who will retain up to 60 per cent of the company following the float. John Trewhitt, managing director, said the first quarter had met expectations, and that the company had had a good Saturday - it took a third of a million pounds on the Grand National alone.

"Most of the flotation proceeds will be spent on upgrading our systems in the shops. We also aim to build the chain to about 150 shops over the next two to three years," said Mr Trewhitt. "We will look at opportunities as they arise." Key targets are small chains of six to seven offices in the North-East and throughout the UK.

The company announced yesterday that Gordon Hodgson, chief executive of the north- eastern car dealership Cowie, will become non-executive chairman. John Trewhitt's brother Nick is development director. David Gilthorpe was recruited from accountants Ernst & Young to be finance director.

About a third of shares will go to institutions and 10 per cent to private investors, said Mr Trewhitt. Since 1992 the company's turnover and operating profit have shown compound growth of 9 per cent and 31 per cent, respectively. Last year Gus Carter made just over £1m profit on turnover of £43.6m.

The company hopes to take advantage of recent deregulation to increase profitability in existing shops. From 6 April betting chains will be allowed to open up their shop fronts, which should help dispel the sometimes seedy image of betting shops in the past. Sunday betting and evening racing should also help profits.