Fire engine firm AssetCo damps down takeover bid

By John Stevens for the Daily Mail
Updated: 18:02 EDT, 14 March 2011

AssetCo, the troubled firm that owns London's fire engines, has rejected a takeover approach from an Islamic investment fund, writes John Stevens.

Shares in the emergency services company jumped by a fifth yesterday as it revealed that the board had rebuffed an 'opportunistic' cash offer from Bahrain-based private equity firm Arcapita.

Arcapita said the approach had been supported by AssetCo chief executive and largest shareholder John Shannon and it was 'still considering its options'.

Critical situation: AssetCo called off takeover talks with another suitor to concentrate on sorting out its finances

The fresh takeover interest put a spark into shares, which have lost 66 per cent over the past month. They closed up 22.4 per cent at 19.75p.

Andy Hanson, of Northland Capital Partners, said: 'The fact that there are still people interested in the business is probably reassurance for investors.'

The support services provider rejected the latest offer a month after it called off takeover talks with another suitor to concentrate on sorting out its finances.

It is seeking approval for a £16million share issue, needed after it received a winding-up order from HM Revenue & Customs, which was owed about £4million.

The company, which owns and maintains tenders and equipment for London and Lincolnshire fire services, said it had received a £1.45million short-term loan from its principal banker to make 'critical' payments.