Shareholders press Ladbroke to bid for Capital Corporation

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The Independent Online
Institutional investors in Capital Corporation, the controversial London casino company, have approached Ladbroke, the gaming group, in the last three weeks to pressurise the company to bid for Capital. It is understood Ladbroke suggested to the institutions an indicative bid price of pounds 150m to pounds 160m. Capital yesterday reported flat half-year operating profits to July at pounds 7m after pounds 4m of costs associated with the blocked bid from London Clubs. Its shares rose 5.5p to 163.5p yesterday, valuing the company at pounds 166m.

Capital, which owns the Mayfair Crockfords and Colony club casinos, was keen to play down recent controversy which has culminated in the company issuing a writ against three former executives. Capital is under a Stock Exchange investigation following news that Garry Nesbitt, former chairman and now a non-executive director, removed a profit warning from the group's draft interim results announcement last September, despite arguments that doing so could create a false market.

Alan Hearn, Capital's recently appointed chief executive, said: "We are in good shape. These results demonstrate that we have drawn a line under this issue. We have the new management in place and we have been fully audited on three occasions."

Ernest Sharp, chairman, hit out at the accusations from former executives including Kenneth Thompson, who resigned as chief executive last year, of irregularities within the company. The allegations surround gaming scam, irregularities in food and drink procurement and failure of Mr Hearn and Mr Nesbitt to notify the board of a bid offer from Ogdens, the US gaming group, made last September.

"These are all lies, all absolute rubbish. Why should we be in the dock answering these questions?" Mr Sharp said. Mr Sharp said Ogdens had approached Mr Thompson individually about a possible bid, but Mr Thompson failed to pass on that information for "about six months". Mr Sharp said the group had no intention of asking Mr Nesbitt to leave or of taking the company private.

Capital also announced the acquisition of the downmarket Cromwell Mint casino in Knightsbridge for pounds 22m cash.

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