Silentnight in £23m Parker Knoll bid

Silentnight, the UK's biggest bed manufacturer, unveiled a £23m recommended cash offer yesterday to acquire Cornwell Parker, maker of the Parker Knoll reclining chair.

Silentnight, the UK's biggest bed manufacturer, unveiled a £23m recommended cash offer yesterday to acquire Cornwell Parker, maker of the Parker Knoll reclining chair.

Silentnight, which owns the Sealy, Rest Assured and Silentnight bed brands, is making the acquisition as part of a wider strategy to diversify within the furniture market. The group is in talks with "a number of other parties" concerning other possible deals.

The announcement came as Cornwell reported a pre-tax loss of £6.9m for the year ended 31 July. That compared with a £3.2m profit the previous year.

Bill Simpson, Silentnight's chief executive, said: "I think we can grow the [Cornwell] business back to where it was.... We can give it the focus and direction which, frankly, have been lacking."

Cornwell, which makes Stag cabinet furniture as well as its famous chairs, operated without a chief executive for about 18 months until Andrew Stafford, a former ICI director, was appointed to the role in July.

Mr Simpson said: "I have had 36 years in furniture. Mr Stafford is a very competent manager and chief executive but he has only been in the business for a short time."

Mr Stafford, who is expected to leave the company if the deal is approved, said the Cornwell board had recommended the takeover because it was in the best interest of shareholders.

He said: "This offer gives them the opportunity to realise their investment in cash at a time when market sentiment towards smaller companies and the furniture and fabrics sector is not very favourable."

The Silentnight bid values Cornwell shares at 55p. That represents a near 50 per cent premium on the 37p price at which the smaller company was valued before it revealed it was in talks on 22 September. Cornwell's shares closed up 2p at 54.5p yesterday. Silentnight shares ended unchanged at 175.5p.