Amstrad empire to shed Dataflex

Management buyout of modem division is expected to take place within next three to six months

Amstrad?s modem arm, Dataflex, is understood to be undergoing a management buyout within the next few months, fuelling further speculation about chairman Alan Sugar?s withdrawal from the IT industry.

According to sources, the management team at Dataflex, which includes founder and technical director Jerry O?Prey and managing director Jacob van Houdt, is planning a management buyout. It is expected to be concluded within three to six months.

One source said: ?It is a one product company, with no manufacturing unit. Sugar won?t release any resources for it and he does not care who he sells it to.?

There has been growing speculation that Sugar was leaving the IT market, selling off Amstrad?s remaining three arms ? Dataflex, Viglen and Betacom ? to concentrate on Tottenham Hotspur FC. Last week, Amstrad sold its telecoms arm, Dancall, to Bosch for #92 million, four years after purchasing it for #6.3 million (PC Dealer, 9 April).

Andrew Bryant, analyst at NatWest Securities, said: ?My speculation is Sugar is looking for MBOs for all of his businesses. He doesn?t like the city. Either he?s got to invest in big acquisitions and build the company up to something different or he?ll sell up and go and do something different.?

Amstrad bought Dataflex Design Communications from the liquidators for #375,000 in March 1995, beating the management-led team that wanted to shift its focus to the high-end modem market, ISDN and internetworking products. Since the purchase, Dataflex has exclusively sold modem cards manufactured in Taiwan with Sierra chips, boosting its turnover from #5.5 million to #8 million.

Nigel Rix, Dataflex sales and marketing director, refused to comment on the MBO. An Amstrad representative denied that more sell-offs were planned, adding that Sugar may consider using his #200 million cash pile to amass more firms, but would not invest any more into Tottenham Hotspur.