The news late Thursday that Combined Lease Finance Plc had made an agreed bid for Technology For Business Plc (CI No 741) came as something of a surprise. What would a company that thinks it’s a bank want with a computer systems manufacturer and turnkey supplier to solicitors? The answer, according to Colin Mudd, managing director of CLF’s computer financing subsidiary Rental Systems Ltd, is that Technology For Business fits CLF’s strategy of adding value to the money it lends its customers. Combined Lease Finance and TFB have been working together for three years with CLF providing leasing facilities for TFB products while TFB has helped maintain its own and third party equipment leased from CLF. The relationship between the companies’ chief executives, Tony Barnes and Paul Bion, however, goes back further than the joint activities of their respective companies – they used to work for NCR together! Bion, who is well known and well regarded in the City and in the industry, says the deal will make TFB financially more robust and, therefore, more able to expand both organically and through acquisition. Technology for Business was created out of the ashes of Logabax UK, and has gone from strength to strength since its Unlisted Securities Market debut valued it at UKP3m in 1983 – it’s going out for UKP11.2m. Earlier this year, it acquired fellow UK multi-user systems maker LSI from CPU Computers Plc (CI No 616, 617), having previously bought and turned round the loss making Rair Ltd. Bion is joining the CLF board, but says that TFB will continue to be run as an independent concern. CLF is hoping that its new purchase will help its own sales of services to the legal market. When it came to the market in May last year (CI No 427), Combined Lease was valued at UKP23m and had a turnover of UKP17m. Its value now is UKP68m and in the year to December 1986 it made UKP2.7m on sales of UKP26.2m. CLF recently negotiated a UKP90m line of finance to help it expand its existing operations, but TFB still represents something of a catch. In its last financial year, also to December 31, TFB made UKP510,000 pre-tax on turnover of UKP9.82m and Bion describes its current state of activity as pretty busy. The TFB takeover at 195.6p a share, 47p above its market price when the offer was announced, expands CLF’s computer interests from 20% to around 50%. CLF’s other business comes from leasing prestige cars and industrial machinery with values of under UKP50,000.
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