Cementone reverses into Multitrust

CEMENTONE-BEAVER, the building materials company controlled by Vijay Mallya, the Indian-born entrepreneur, is reversing into Multitrust, the property shell, writes Neil Thapar.

The takeover, exclusively revealed by the Independent last month, enables C-B to obtain a Stock Exchange listing with a market value of pounds 16m.

The company, which manufacturers branded and own-label paints, wood preservatives and cement additives for the building trade, was bought by Mr Mallya for pounds 12m in 1988 from CH Industrials, the mini-conglomerate that later went into receivership.

Multitrust is allotting Mr Mallya, Cementone's non-executive deputy chairman, 12.3 million shares, valuing Cementone at pounds 9m. Multitrust, which changes its name to Cementone, is also launching a three-for-four rights issue at 73p a share to raise pounds 2.8m.

Following the takeover Mr Mallya will own almost 34 per cent of the enlarged group while Andrew Perloff, who currently heads Multitrust, will have about 12 per cent. Cementone is joining the market to cut borrowings and take advantage of acquisition opportunities. It is forecasting pre-tax profits of at least pounds 31.2m for the year ending this month, valuing the shares at almost 16 times prospective earnings.