Talks with Possible Buyer Put Wakebourne Shares in Limbo

Shares in Wakebourne have been suspended on the UK Stock Exchange after the loss-making reseller and maintenance group admitted it was in advanced negotiations with a potential purchaser.

In a statement, Wakebourne said it was ?in advanced negotiations which may lead to an offer for the whole of the issued and to be issued share capital of the company?.

But Wakebourne admitted that any offer would be substantially below its current share price of 10p.

Wakebourne?s banker, The Bank of Scotland, would also need to agree to any takeover, the company said in a statement to the Stock Exchange.

One analyst said: ?It?s make or break time for the company. Wakebourne?s market cap is #2.4 million. With an offer of 5p or 6p, The Bank of Scotland may think it is better off putting the company into receivership and liquidating the assets.?

In its latest full-year results, Wakebourne made a pre-tax loss of #3.3 million on sales of #36.7 million in the year to December 1995. Wakebourne reported a pre-tax profit of #212,000 and a 14.3 per cent decrease in turnover to #16.1 million for the six months to 30 June 1996.

Frank Emerson, CEO of Wakebourne, has previously admitted that measures to increase sales were taking longer than anticipated to generate profits, as the group attempted to steer its business towards network integration.