Mentmore files interest in £160m Hays sale

Mentmore, a UK-listed storage specialist, said yesterday that it was one of the contenders in the £160m auction of Hays' document storage business.

Mentmore, a UK-listed storage specialist, said yesterday that it was one of the contenders in the £160m auction of Hays' document storage business.

Iron Mountain Europe (IME), a Mentmore joint venture with the US records management company Iron Mountain, has asked the Office of Fair Trading for clearance for the proposed acquisition, triggering yesterday's disclosure. Mentmore also has a serviced offices business, but it is trying to sell this to concentrate on rented storage units and document storage.

There are believed to be a number of other bidders for the Hays IMS business, with Brambles the other trade buyer reckoned to be in the game. Financial buyers Electra Partners and Barclays Capital are also thought to have shown interest. The auction is currently in the second round of bids and the outcome is some way off.

Mentmore said: "The submission of this notice represents the first stage for IME in obtaining merger clearance in the UK for the potential acquisition of Hays IMS. For the avoidance of doubt, IME has not been selected as the preferred purchaser and has not entered into any agreement with Hays plc for the purchase of Hays IMS."

The Hays business has centres all over the UK providing companies with space for documents and data stored on paper and electronically which needs to be accessible.

Hays is a conglomerate but, following a strategic review under new chief executive Colin Matthews, it announced in March that it would sell everything except its recruitment business. The Hays logistics division is the biggest of the Hays businesses now up for sale.

Hays is likely to hold onto its mail delivery venture a little longer, but this too is expected to go up for sale over the next two years. It recently won a new licence for delivering and it believes it can raise more money after allowing this business to develop.

The recruitment arm provides some 60 per cent of Hays' operating profits and the company argues that this business has proved much more resilient than its rivals, which have seen revenues plummet in the economic downturn.