Tiphook confirms search for new chief

TIPHOOK, the troubled transport leasing group, confirmed that it was seeking a new chief executive to work alongside Robert Montague, who would continue as chairman.

Mr Montague, chairman and chief executive, has come under severe pressure to relinquish one or both roles after a series of profit warnings that culminated last week in an announcement that Tiphook would breach banking covenants.

But sacrificing day-to-day control may not be enough to pacify lenders and investors, angry at Tiphook's disappointing record of late. US bondholders are threatening to sue the company, claiming they were not given adequate information at the time of the bond issues.

A Tiphook spokesman said Mr Montague would remain chairman, because he understood the business better than anyone and would be required to help to sort out the company's problems.

The company released figures yesterday showing a small rise in utilisation levels for its containers and trailers in September.

Average container use was 82.25 per cent compared with 81.99 per cent in August. Trailer use rose from 69.36 per cent to 73.22 per cent.

The extraordinary meeting of shareholders to approve a change to the company's articles of association allowing debt gearing to rise above 500 per cent has been scheduled for 25 October. A spokesman said discussions with banks, bondholders and shareholders were continuing. He said Tiphook was also looking for two new independent non-executive directors.

The company has been in crisis since it warned last week that profits for the year to next April would be considerably below market expectations, while debt was likely to rise above the permitted ceiling of five times shareholders' funds.

Investors have had to contend with bear raids and two previous profits warnings this year.

The shares, which halved in price to 123p last week, closed 15p higher yesterday at 138p.