It is not clear whether Clive Holmes, the division's managing director, is involved in the buy-out which is due to be completed by the end of next month. He was cleared earlier this year by a Stock Exchange investigation after he netted nearly pounds 42,000 from the sale of 61,338 share options just six days ahead of a profit warning which sent the shares plunging 84p to 207p. Hogg blamed the warning on the strength of the pound, which has hit its Nordic travel business and the European trailer operations.
Brian Perry, the chairman who is to be replaced by the former Coats Viyella chief executive, Neville Bain, in September, strongly resisted proposals for a break up and share buy back put forward in October by Julian Treger and Brian Myerson, whose UK Active Value Fund is a 3 per cent shareholder in Hogg. Mr Perry acknowledged yesterday that the two fund managers had "started the ball rolling" and that there had been some shareholder pressure to divest the transport operation.
The group saw its shares bounce 9p to 205.5p yesterday as the market responded warmly to the new strategy and better than expected annual pre-tax profits of pounds 24.7m, down from pounds 26.3m before. Profits from the transport business tumbled from pounds 5.77m to pounds 3.05m.Reuse content