View from City Road: Long wait at Tiphook

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The Independent Online
After relentless bad news, Tiphook surprised everybody with the price for its container assets. Transamerica clearly feels it is worth paying well to catapult itself into direct competition with its fellow US giant, GE Capital.

The deal provides a glimmer of hope for Tiphook and is good news for bankers who were concerned about getting their money back. For bond and shareholders, the outlook remains uncertain.

Tiphook will be left with about pounds 400m of borrowings that will have to be serviced with the profits of the trailer business, which made just pounds 3m before tax in its last financial year. In trailers it is Europe's leader, and should do well when the market on the Continent starts to recover. But waiting for recovery can take painfully long.

The sale of the container business may ease the pain a little, but investors will still have a tedious wait before they can be confident of a decent return.

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