Henlys in sales deal with Volvo Bus Corp

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The Independent Online
HENLYS Group, the motor trader and bus manufacturer fighting a pounds 25m all-paper takeover bid from T Cowie, has bolstered its defences by forging a sales and technology alliance with Volvo Bus Corporation, Europe's second-largest bus manufacturer.

The export sales agreement, to run for at least five years, sets an annual target of 200 Plaxton coaches, worth about pounds 15m.

Under a technical co-operation agreement, Volvo will send two senior production managers to work at Plaxton's Scarborough factory and will give Henlys access to its manufacturing expertise. This agreement lasts for at least a year.

Robert Wood, chief executive of Henlys, said: 'We will benefit immensely from the technical co-operation agreement and, even more so, from the export sales agreement. This alliance enhances the strategic growth prospects of our coach and bus building business by adding scale and reducing our traditional dependence on the home market.'

Henlys has not sold coaches for export before.

Last week Henlys announced pounds 17m of orders, from a number of clients, for 370 coach and bus bodies to be delivered over two years.

Volvo and Henlys have a history of co-operation.

Henlys shares fell 1p to 69p and T Cowie fell 3p to 121p. Henlys has until next Tuesday to make a profit forecast under Takeover Panel rules.