Amco directors launch £36m buy-out bid

A proposed management buy-out pitched at less than the current market price has been made for Amco Corporation. It values the £130m-a-year turnover construction group at £36m.

The two directors making the move are Ian Swire, finance director, and David Jackson, commercial director.

The move would have been kept under wraps had it not been for the unusualness of the offer price. "The price means there is the risk of a false market," said a spokesman for Amco.

"If it had been pitched at say 10% over the current share price, it would have remained highly confidential."

Amco's share price doubled in less than 12 months, from 180p in late summer last year, to 370p in May of this year.

Amco's shares are 'illiquid' - a financial expression to indicate that only a limited proportion of them trade freely on the Stock Exchange.

In Amco's case, this is because 49.9% of all the 13m shares are held by Amco Investments, a trust for the founder's family. The trust is thought to be fundamentally supportive of the move.

[Contract Journal, 16 August 2006, p.3]