Ladbroke 'in discussions' over sell-offs

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The Independent Online
LADBROKE, the gambling-to-hotel-chain group adjusting to life without Cyril Stein, its former chairman, is close to selling a number of its property interests.

According to sources close to the company, the group is in discussions with property companies and financial institutions, and should see a series of disposals in the coming months.

At one time the company was believed to be considering floating its property interests as a separate company. But it is now clear that these interests will be sold piecemeal. The sale of properties worth up to pounds 1m has already been agreed, subject to board approval.

'We have to have our minds on alternative things that we might do with our money, such as invest in Texas, the DIY chain, hotels and gambling,' an insider said.

But an official spokesman stressed: 'We are not forced sellers and we will only sell our properties if we can get good value for them.'

Shares in Ladbroke have been performing strongly since the company announced the week before last that Mr Stein would make a complete break with the company.

On Friday the shares closed at 209.5p, nearly 30p higher than the day Mr Stein's departure was announced.

However, insiders at the company are aware that the rise has been caused by a change in sentiment and does not yet reflect a change in fundamentals.

The market is waiting for the group to bring debts down - they are currently around pounds 1.3bn. It is also expecting, for prudence's sake, a dividend cut when results are announced later this year. Last year's dividend of 11.2p may be cut to 7p.

Meanwhile, it has emerged that negotiations between Cyril Stein and the group over the terms of his departure had, at one point, become quite tense.

Mr Stein exited from the company he headed for 37 years with a pay-off of pounds 200,000 and a consultancy fee of pounds 165,000 a year for five years. The company strongly denied rumours that Mr Stein had been interested in buying some of the group's properties.

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