Page 11 - Stakis C Case Study

to 30th September 1992. At the same time the one for three
rights issue of £28 million was announced to the public. It

was also announced that the Ashbourne nursing Homes

Division were to be sold. The paying of a dividend for the
year was a mark of confidence in the future. From a low of

19p per share in its darkest period Stakis was now on the

road to recovery.

The loss on the sale, £47.7 million was provided for in the

accounts for the year to 27th September 1992 and

represented mainly, the difference between the book value

and the disposal price of the assets. The board considered
the price reasonable. Moreover, if the eventual share price

of the new company, Dalglen, exceeds current expectations

Stakis would receive a proportion of this excess.

Tom Hamilton was to continue as managing director of

Ashbourne and duly resigned from Stakis PLC when the

transaction was completed. Stakis agreed to continue to
provide for one year a limited number of group services to

Ashbourne.

The recovery in the business was evidenced by a move into
profit announced in June 1993 and the payment of an

interim dividend. The improvement, according to David

Michels, was due largely to its own efforts at improving
margins and controlling costs rather than to increasing

demand. Sir Lewis Robertson said:

"It's a recovery in the sense that there is no illness now
and there is more to come as the economy improves. It's