Financial News

  • 4 December 2013, 17:08

Moulton Sizes Up Bid For Ailing Pawnbroker

The veteran investor Jon Moulton is sizing up a takeover bid for the embattled pawnbroking chain Albemarle & Bond (A&B).

Sky News has learnt that Better Capital, Mr Moulton's investment firm, is among a pack of suitors examining offers for the company after it was forced to put itself up for sale.

Albemarle & Bond has lurched from one crisis to another in recent months, announcing last week that it had resorted to melting its gold reserves to raise cash.

On Monday, it said that five of its board members had resigned, leaving Greville Nicholls, its chairman, as its only non-executive board member.

Albemarle & Bond has been hit hard by the declining gold price and has struggled within its borrowing agreements with its lenders.

Last month, the company said the trading environment had continued to be challenging, "with no signs of recovery in the key trading metrics of pawnbroking advances or gold buying".

"The gold price has seen further weakness and, as of 26 November 2013, is 27% below the average price for March 2013," it said.

If it does proceed with an offer, Better Capital will not be the only bidder for Albemarle & Bond. A number of other specialist distressed investors are circling, although the company warned this week that there was no guarantee that a transaction would result.

Founded in 1983 with a single shop in Bristol, Albemarle & Bond expanded rapidly, to the extent that it had established dozens of pop-up shops to take advantage of demand for its services. In 2011, the company went so far as to declare "the age of the pawnbroker".

Albemarle & Bond has been struggling since the summer when its biggest shareholder, EZCorp, declined to back a 35m rights issue.

City analysts are now split about its survival prospects, having watched its shares dive by 90% this year.

Mr Moulton, whose funds own the parcel delivery company City Link and Jaeger, the fashion brand, could not be reached for comment on Tuesday.