St Ives sells Bradford operation in £8m deal

ST IVES announced today it has sold St Ives Direct Bradford (SIDB) to Cogent B2B as part of its continuing strategy to refocus the group’s business.

Total consideration for the disposal will be £8m, comprising £3m payable immediately and £5m of deferred consideration.

SIDB offers direct mail, digital printing and general commercial printing capabilities to UK based customers. As at July 27 2012, SIDB had gross assets of £11.1m.

In the financial year ended July 27 2012 it generated £35m of revenue and profit before tax of £1.2m

St Ives will retain the ownership of the property currently occupied by SIDB in Bradford and will lease it to SIDB at a market rent.

The deferred consideration is repayable in 24 monthly instalments starting on November 1, guaranteed by Cogent B2B and secured over SIDB’s assets.

“The disposal is consistent with the group’s strategy of refocusing on marketing services whilst moving away from the commoditised sectors of the print market,” St Ives said.

“SIDB has continued to experience tough trading conditions, where excess capacity has exerted downward price pressure resulting in reduced levels of profitability.”

The proceeds of the disposal will be used to support further development of the group’s business, it said.

Patrick Martell, chief executive of St Ives, said: “Following a fundamental realignment of our business, in which we have built a substantial and broadly-based marketing services offering while moving away from commoditised print, it is clear that SIDB no longer fits within our new structure and will benefit from alternative ownership.

“This effectively completes the exit from our non-core printing operations, and allows us to focus wholly on strengthening our marketing services offering and remaining print businesses, in line with our stated strategy.”

The purchase by Cogent B2B was made possible by a £4.5m invoice finance funding line from Bibby Financial Services (BFS), which was put together in less than five days.

Dave Golding, corporate director at BFS, said: “We’re pleased that we were able to work with a Cogent B2B to develop a financial solution within the required timings.

“We are now providing on-going advice in relation to restructuring SIDB and supporting its new owners.”

BFS has offices in Bradford and Leeds and is currently providing upwards of £44m in funding to Yorkshire-based businesses.

Christian Hunt and Rachel Dean of Leeds-based Clarion provided legal advice to Cogent B2B.