Takeover could send Centaur galloping to AIM flotation

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The Independent Online

Centaur Communications, the group that publishes The Lawyer and Marketing Week magazines, is to float on the stock market in a deal that will turn some of its managers into millionaires.

Numis, the stockbroker, is in negotiations with the directors who, together with a handful of City institutions, own the company, over a takeover that could value it at £160m.

Numis would then immediately float Centaur on the junior Alternative Investment Market. A flotation would crystallise the 14 per cent stake held by Graham Sherren, its chairman and chief executive.

Other senior staff own a further 16 per cent of shares in the company, with institutions accounting for the balance, led by Veronis Suhler Stevenson, the US bank, which owns a 35 per cent stake and also organised the sale.

The move - known in the City as an accelerated IPO - was first used by Collins Stewart, the broker, when it bought and floated first Northumbrian Water and then Center Parcs, the holiday resorts group.

Centaur has tried and failed to float in the past, appointing advisers as recently as 2000 to advise on a flotation that was estimated then to have valued it at £100m.

Although publishing provides the majority of the business for Centaur, with 35 magazine and newsletter titles, the company also includes conferences and exhibitions units.

One report yesterday said that Centaur was believed to have made a pre-tax profit of £5.6m in 2003 on turnover of £56m. Centaur has been hard hit by the advertising downturn in recent years but backers of the flotation are hoping that it will be able to harness an upturn in the advertising cycle.

For Numis, which is itself quoted on AIM, the accelerated IPO will be seen as further evidence of its development.

It began by concentrating on the insurance sector but its focus now includes retail, food, leisure, support services, media, resources, technology and life sciences.

Elsewhere, the car accessories group Halfords refused to comment on reports that its owner, CVC Capital, was planning a £1bn flotation.

CVC Capital is reported to have drawn up a shortlist of institutions to advise on a flotation of the company it bought from Boots in July 2002.

Halfords, based in Redditch, Worcestershire, generates sales of more than £600m a year with operating profits close to £80m.

CVC has a reputation for investing in the retail sector since buying Halfords for £425m in 2002, and backed the £1.25bn takeover of department stores group Debenhams last year. The flotation of Halfords would let the private equity firm reduce its exposure to the retail industry at a time when consumer spending is expected to slow.