Page 5 - Stakis Consolidated Teaching Note

saw the company diversifying into both property and
financial services.

By the mid1980's speculation was growing about a
possible successor to Sir Reo who was then 74. A series of

replacements were mooted but board differences resulted

in no successor being appointed. In the end Sir Reo's 32-

year old son Andros who had first been appointed a
director in 1982, was appointed as both managing Director

and the new post of Group Deputy Chairman in 1988.

Andros rapidly developed a new thrust in the company
towards the creation of a new concept in hotels termed

‘Country Court Hotels’ and a move into a new area of

health care. This was accompanied by numerous board
changes with a clutch of non-executives being appointed.

Borrowing doubled to £99 million, giving a gearing level of

35%.

By 1987 two new divisions had been added to the

company’s portfolio. First, Finance was added and later

this was followed by the creation of a Property Division.

Outside the company, criticisms were being raised that the

new managers appointed by Andros never blended with

the old generation. In addition, the expansion
programmes proved expensive requiring maximum cash

at a time when the recession had deepened. Debt rose

from £99 million to £151 million by September 1990.