Rank sells film distribution unit to Carlton for pounds 65m

Rank sold its film distribution arm to Carlton yesterday for pounds 65m, towards the top end of expectations for the division which had been up for sale since February.

However, Rank won't give up its trademark "man with the gong" logo, but will license it to Carlton for use in opening sequences of the films in the library. Rank is also hanging on to its film delivery service.

Shares in both companies rose after the announcement, which gives Carlton a library of 740 feature films and increases Rank's focus on its core leisure operations.

Rank Film Distributors' extensive collection of films spans more than 60 years of British cinema and includes Oscar-winning classics such as Brief Encounter and The Lady Vanishes. Other well-known films in the portfolio are Laurence Olivier's Shakespeare epics Hamlet and Henry V. Carlton will also gain control of popular favourites such as the Carry On series, Reach for the Sky, The Ipcress File and Oliver Twist.

Rank said two months ago it planned to sell its film distribution arm in a bid by the new chief executive, Andrew Teare, to focus on the group's core leisure businesses that include the Hard Rock cafes, Butlin's holiday camps, Tom Cobleigh pubs and Odeon cinemas.

Carlton said it would distribute the films acquired from Rank with its existing library of movies and TV programmes. The film library would also be a boon for the film channel it planned to launch on digital television, it said.

Carlton, largest of Britain's 15 commercial television stations, broadcasts to 22 million people in London and Birmingham. In February it joined BSkyB and Granada in a venture to bid for licences to operate digital television stations from mid-1998.

The film business made operating profits of pounds 4.1m on sales of pounds 25.4m in 1996 and had assets of pounds 31.3m. Analysts had expected the division to raise between pounds 50m and pounds 70m after the company poured cold water on earlier estimates that it might be worth up to pounds 150m.

As part of its reorganisation, Rank has already raised about pounds 300m from the sale of businesses including its engineering division and the Shearings bus holiday operation. It still plans to sell its stake in the Rank Xerox office equipment venture,worth an estimated pounds 930m.

The sale of the film distribution arm is the latest move in an increasingly urgent attempt to inject some sparkle into one of the great names in the British entertainment industry which in recent years has lost its lustre. When Mr Teare arrived from English China Clays a year ago he found the group in less robust shape than he had believed and he has struggled to gain the support of the City which has marked Rank's shares lower ever since his arrival.

They closed yesterday 7p higher at 427.5p, but they have fallen from a high of 545p soon after Mr Teare arrived last spring. Carlton's shares ended 3.5p higher at 519.5p.

Mr Teare has not been idle, spending more than pounds 400m on acquisitions - even more than he has raised from disposals - reappointing three of four divisional directors and revamping the group's accounting policies.

Despite all that, however, Rank's return on capital remains well below target.

Arts and Entertainment
Alfred Molina, left, and John Lithgow in a scene from 'Love Is Strange'
A model of a Neanderthal man on display at the National Museum of Prehistory in Dordogne, France
Dawkins: 'There’s a very interesting reason why a prince could not turn into a frog – it's statistically too improbable'
newsThat's Richard Dawkins on babies with Down Syndrome
Malky Mackay salutes the Cardiff fans after the 3-1 defeat at Liverpool on Sunday
footballFormer Cardiff boss accused of sending homophobic, racist and messages
Arts and Entertainment
Martin Amis: Taken to task over rash decisions and ill-judged statements
booksThe Zone of Interest just doesn't work, says James Runcie
Life and Style
life – it's not, says Rachel McKinnon
Arts and Entertainment
Eye of the beholder? 'Concrete lasagne' Preston bus station
architectureWhich monstrosities should be nominated for the Dead Prize?
ebooksAn evocation of the conflict through the eyes of those who lived through it
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Corporate Tax Solicitor

Highly Competitive Salary: Austen Lloyd: CITY - HIGHEST QUALITY INTERNATIONAL ...

Relationship Manager

£500 - £600 per day: Orgtel: Relationship Manager, London, Banking, Accountant...

Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Test Lead (C#, Java, HTML, SQL) Kingston Finance

£40000 - £55000 per annum: Harrington Starr: A Global Financial Service Organi...

Day In a Page

Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

Blight club: Britain's ugliest buildings

Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

eBay's enduring appeal

The online auction site is still the UK's most popular e-commerce site
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

Magic circles: Artist Olafur Eliasson

Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

Josephine Dickinson: 'How I discovered a new world of sound'

After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

Greggs gives lesson in crisis management

After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

Matthew McConaughey sings the praises of bumbags

Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
7 best quadcopters and drones

Flying fun: 7 best quadcopters and drones

From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
Joey Barton: ‘I’ve been guilty of getting a bit irate’

Joey Barton: ‘I’ve been guilty of getting a bit irate’

The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
Andy Murray: I quit while I’m ahead too often

Andy Murray: I quit while I’m ahead too often

British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
Ferguson: In the heartlands of America, a descent into madness

A descent into madness in America's heartlands

David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

BBC faces corruption allegation over its Sir Cliff police raid coverage

Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home