Merger gives Harveys listing

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The Independent Online
Lord Harris, the Carpetright chairman and Conservative Party benefactor, secured his second stock market vehicle yesterday when the pounds 80m merger between Harveys, the home furnishings chain and Cantors, the furniture retailer, was confirmed.

The Harris family, which controlled a 43 per cent stake in the Harveys home furnishings chain, will see its stake in the new company reduced to just over 20 per cent, valuing it at pounds 16m.

Sir Harry Solomon, the Harveys chairman will become chairman of the new company which will be re-named H&C Holdings. Lord Harris will stay as a non-executive director. Most of the stores will be re-branded as Harveys.

Sir Harry said: "The industry is very fragmented and this provides us with a unique opportunity to be a major player. We had a number of options. We could have gone it alone or bought other companies. But his gives us a quotation."

Harveys' textile ranges, such as curtains, will be introduced to Cantors furniture stores. The number of stores will be expanded from 300 to 400 over the next three to four years. Around 12 stores will close as part of a rationalisation programme.

The Cantor family, which owned a 40 per cent stake prior to the deal, will see its shareholding cut to 17 per cent. Cantors' chairman Nick Jeffries said: "It is sad that Cantors will not be the major trading name, but it will not disappear. This is a good deal and I'm very enthusiastic about it."

However, Cantors staff criticised the company for failing to keep workers informed.

As part of the deal, Cantors has announced a placing of an open offer to raise pounds 8.3m to fund the costs of the merger and to provide working capital. The one-for-three placing and offer is priced at 165p.

The merger is on the basis of 883 Cantors shares for every 50 Harveys. This values each Harveys share at pounds 29.14.