Hambros near to end with demerger move

THE demise of blue-blooded merchant bank Hambros took a fresh step today as the company unveiled proposals to demerge its 51% Hambros Countrywide subsidiary and said it has identified parties who may be prepared to make a bid for the remaining Hambros group.

Under a complex series of proposals aimed at tax efficiency, Hambros is planning a capital reduction.

It will see shareholders receive one new Hambros share plus Hambro Countrywide shares "representing their proportionate entitlement to Hambros' shareholding in Hambro Countrywide", a statement from the company said. Hambros also said that Hambros Insurance Services, in which it also has a controlling stake had appointed financial advisers "to assist it in reviewing all options open to that company". Hambros shares rose 4p to 288 1/2p but Hambro Countrywide fell 6p to 133 1/2p. The company said the amount of shares received would depend on whether preference shareholders wished to convert their shares. If no preference shareholders elected to do this, holders of 100 Hambros shares at the moment would receive 100 new Hambros shares, plus 100 in Hambro Countrywide. However, if all the preference shareholders elected to convert they would still receive 100 new Hambros shares, but only 79 Hambro Countrywide shares. Hambro Countrywide is an estate agency and property company listed in its own right on the Stock Exchange. At close of trading yesterday Hambros' stake in the company was worth GBP 256.3 million. The unravelling of the Hambros group began in earnest late last year with the sale of its banking business to France's Societe Generale for GBP 300 million. Hambros chairman Sir Chips Keswick said the distribution of the shareholding was a major step. "The board is actively progressing discussions with certain interested parties who may be prepared to make a public offer for Hambros following the distribution of our Hambro Countrywide shares," he said. Hambros' remaining assets include a 44.2% stake in Guinness Flight Hambro. The Guinness Flight Hambro board has appointed financial advisers to solicit proposals for the sale of the stake.

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