Bid approach stirs Redstone

10/09/2009 Robert Tyerman

Redstone, whose executive chairman is Alan Coppin, has received an ‘early stage approach’

Bombed-out IT equipment outfit Redstone says it has received an ‘early stage approach’, which may or may not lead to a bid.

News of potential bid talks follows loss-making Redstone’s agreement to sell its telecoms arm for £17 million to ambitious AIM newcomer Daisy Group. This immediately provoked speculation that Daisy, whose chairman Peter Dubens has said he wants to make it a major telecoms supplier to UK small and medium-sized companies, could be the interested party, even though a Daisy spokeswoman insists the other parts of Redstone would be 'non core' to its strategy.

Itself quoted on AIM, Redstone, which chalked up an interim loss of £1.8 million, has lately been seeking ways to reduce its debts. Two days ago, the company, which bought Symphony Telecom Holdings from Eckoh Technologies in 2006, said it had so far failed to reach agreement with Eckoh over repayments of a £2.7 million loan facility between Symphony and Eckoh.

Shares in Redstone, which plunged during the past 12 months from 46.75p to 3.25p, have bounced to 6p, valuing the company at £8.7 million. Shares in Daisy Group, which floated on AIM two months ago with an £83 million equity raising at 80p, now stand at 95p, valuing it at £244 million.

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