LanBase founder to net pounds 6.5m after agreeing sale

KEITH BERRY, the founder and managing director of data network group LanBase, is in line for a pounds 6.5m windfall after agreeing to sell the business to Workplace Technologies, the former UK customer service division of ICL.

Workplace, floated on the London Stock Exchange 12 months ago, said the deal valued LanBase at up to pounds 19.6m and would allow Workplace to extend its data network services into the high-growth financial services sector centred on London and the South-east.

Mr Berry and other members of management secured loans on their homes and invested their own money to set up LanBase in 1991. Mr Berry, who initially invested pounds 40,000 and took out a second mortgage on his home, now owns about one-third of the company, valuing his stake at around pounds 6.5m. He joins the board of the enlarged group.

LanBase specialises in the supply, installation and support of data network packages. It derives a substantial part of its turnover and profits from support services contracts.

Workplace Technologies yesterday said it would pay up to pounds 8.88m in cash, pounds 1m in loan notes and issue shares valued at pounds 6.5m, dependent on LanBase achieving operating profits of pounds 2m in the year to 31 December. Last year LanBase made a pounds 1.52m profit on turnover of pounds 19.9m. Workplace Technologies shares yesterday rose 4.5p to 153.5p, valuing the company at pounds 44m.

Workplace also issued an update on current business, repeating its warning that it was likely to take an larger-than-expected interest charge in the full year, mainly owing to payment delays by the Hong Kong Airport Authority. It said it was confident that most of the money owed by the airport authority would be received by year-end, and current trading was in line with expectations.