Dear diary: Letts remember, must pick up that Filofax

A Filofax was once the must-have accessory for the young and upwardly mobile in the Eighties. Now the maker of the personal organiser has been sold to rival Letts, which makes diaries, for just £17m.

The combined companies will have a £55m turnover and profits of around £5.5m. At Filofax's peak, profits were £6.6m, but even rivals making electronic personal organisers, such as Palm and Psion, are experiencing difficulties.

"The major players in the PDA market have all recently indicated business downturns, with Palm announcing its withdrawal from the PDA market," said Gordon Presly, the managing director of Letts, who led the management buyout. "But we are joining two solid companies that are making money even if they are not as sexy as other players."

Letts is involved in the development of a new electronic diary. This will use normal paper impregnated with an electronic matrix that will transfer an entry made in the diary to a computer, via a mobile phone. Mr Presly said the acquisition of Filofax will create synergies because Letts has distribution channels in Canada and Filofax is in several European countries, Hong Kong and the US, so one brand can be pushed out in the other's area.

He said they will not take sales from each other because they are not competing in exactly the same market. A year ago, Letts was bought from 4imprint, then called Bemrose Corporation, for £17m. The buyout was backed by Dunedin Capital Partners, the private equity firm, and Bank of Scotland. Both financed the acquisition of Filofax. Letts fought off bids from two private equity houses.

Filofax has had a troubled past. The company did suffer losses in its heyday Eighties, and before former chairman Robin Fields became chairman in 1990, it was close to collapse. Filofax was bought by US company Day Runner in 1998 for £50m but the new owner ran into problems, ending in the sale to Letts.

The two brands have a long history in Britain. Letts was born around 200 years ago when Charles Letts launched the first commercial diary. The first Filofax was sold in 1921 and then became popular with vicars and Army officers.