Troubled Bespak reveals takeover approaches and warns on profits
Wednesday 09 April 2003
Bespak, the beleaguered asthma inhalers and sprays maker, said yesterday it had attracted several bid approaches, taking some of the sting out of another profits warning.
The company, whose shares have halved in a year, cautioned that the approaches were at an early stage, while analysts said trade buyers may be more interested in cherry-picking the group's assets. The company's shares ended down 35p at 247.5p.
Bespak's 700 UK employees are braced for job cuts, as the company plans to cut £7m from annual costs.
Yesterday's warning blamed falling sales of the valves used in inhalers, because the industry is moving away from the use of CFC-based products, which are deemed environmentally unfriendly. CFC-based valve sales are falling away faster than replacement products are being approved by regulators, the company said. The problems will wipe out profits for the six months to the end of April.
It is Bespak's second profits warning in five months, and the group has responded by slashing spending on innovative nasal sprays, which it had hoped pharmaceuticals companies would use to deliver drugs. But the market has always been wary about Bespak's strategy of investing in nasal sprays and Brett Pollard, analyst at Seymour Pierce, said yesterday the company had been distracted by the effort from running its core business without incident. "We think that the company is right to curtail the nasal programme and concentrate on its core."
But Mark Throdahl, Bespak's chief executive, insisted nasal sprays would remain a substantial part of the business. "The effort of diversifying has been worthwhile. We have learnt a lot and will be able to capitalise on what we have learnt. It is sensible to retrench to areas of strength."
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