Solus 'close to a deal' with new investors - updated
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Trade speculation heightened this week that a deal between Solus Garden & Leisure and new investment partners was imminent. A spokesperson said there would be no statement this week, but sources close to Solus believe that negotiations with a finance house, possibly a private equity firm, are at an advanced stage and that a deal could be announced as early as next week. One industry observer believes a deal involving an investment house is unlikely unless Solus were able to meet stringent due diligence requirements. Some believe a merger with an established supplier like Gardman is still the most likely scenario, despite Gardman CEO Stuart Hainsworth’s insistence that the timing is not right for them or their backers (Goldman Sachs, TPG and Barclays). Retailers have been concerned about continuity of supplies since the news three weeks ago that merger talks between Solus and Scotts had collapsed, at a critical point at the start of peak season trading. Ross Yealland told GTN Xtra "We are totally focussed on delivering products and have good availability. Trading has been strong through April and we are grateful for the huge amount of support we have received from the industry."
"Grant Thornton are being extremely helpful with our stragtic review and have brought many new ideas and potential partners to the table. In the meantime, Solus has massively supportive stakeholders, so there is no need for us to rush with the next step forward. We will update our customers as soon as we can." Any deal with equity backers would see the sector’s fortunes go full circle. Gibbs Palmer, from which Solus emerged after Simon Yealland formed Gibbs Palmer (Midland) in a breakway deal, was acquired by Close Brothers in 1998. The wholesaler went into receivership two years later, leaving a trail of collateral damage, but Solus became a runaway success.
GTN Xtra comment: The future of Solus has been a key topic of conversation for almost a year now, with the first question we are asked is always "What's going on at Solus?" It's good to hear from Solus that business is good and that they are focussed on delivering products so that retailers and supliers can make the most of this relatively good season we are enjoying. Here at GTN Xtra we look forward to bringing you news of the next steps for Solus as soon as we can so that the underlying concerns of the industry can be addressed before Plan B's and alternative routes to market are implemented.
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