EMPLOYMENT agency Blue Arrow is being taken over by a rival, The Corporate Services Group, in a deal worth #47.8m. The purchase is being funded through a mixture of cash, shares, and loan notes. The Corporate Services Group is to raise #48.1m through a share offering and placing.
Blue Arrow was bought in June 1991 via a management buyout from US-based Manpower. Its nationwide chain is made up of 80 offices providing employment services principally to the white collar and catering sectors. Last year, its turnover was #117m with an operating profit of #7.5m, #4m higher than in 1994.
Blue Arrow is a complementary fit with Corporate Services' existing activities in contract labour which are currently focused on the industrial, technical, and healthcare sectors.
Commenting on the Blue Arrow acquisition, Jeffrey Fowler, executive chairman of Corporate Services, said: ``For Corporate Services, it is a marvellous opportunity to expand what we have successfully done for five years''.
A number of acquisitions have contributed to strong growth in Corporate Services which has benefited from their databases and large client bases. Last year, it more than doubled its pre-tax profit to #8.4m on turnover up 60% to #133.2m.
The trend among employers to offer short-term contracts provides growth opportunities for employment agencies. The total market for general employment services, including contract labour, is estimated to be more than #10bn. The Blue Arrow brand is to be maintained in the areas where it is strong but over the coming years it will be converted to contract labour from temporary employment.
n Bluebird Toys, maker of Polly Pocket, has bought back 3.3 million of its own shares, equivalent to 6.7% of its issued share capital. The company had earlier said it would buy back up to #10m of its own shares in a move intended to enhance its balance sheet structure and raise earnings per share.
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