Gestetner Holdings Plc’s US acquisition turns out to be that of the international operations of Nashua Corp’s Office Systems and Supplies Group for UKP90.6m – $151m – cash, and assumption of about $51m of debt – so there will have to be a rights issue. Gestetner is proposing a one-for-two rights issue at 180 pence against around 211 pence in market, to raise about UKP65.2m, and the Australian controlling shareholder will be converting the paper it holds to equity, bringing Gestetner in another UKP42.5m. The Nashua international office systems operation principally sells and services copiers and facsimile machines through subsidiaries in Europe – 68% of its total business, and in South America, Australia, New Zealand, Canada and Mexico and via a network of dealers throughout the world. Revenues associated with this business were about $400m and $425m in 1989 and 1988, respectively, Nashua says. Gestetner gets rights to the Nashua name in the territories concerned and looks for big cost savings by merging warehousing and other infrastructure where appropriate. Many of the products in the Nashua catalogue are also sold by Gestetner already, so that it will become a much bigger and more important customer of its major suppliers.Nashua expects to report a modest gain on the sale, and the Nashua, New Hampshire company expects to return a significant part of the proceeds to shareholders by spending it on its own shares.
