Try鈥檚 shares jumped from 27.25p to 30.5p, a rise of 12% and a considerable premium on last year鈥檚 low of 12.75p.
The increase followed speculation that the board was planning to offer shareholders, including fund manager Phillips & Drew, 45p a share for the company. This would value Try at 拢31m.
If the speculation is true, it could mark a trend towards smaller contractors and housebuilders leaving the stock market. Wainhomes went private after a 拢88.1m management buyout in March.
A Try spokesperson said: 鈥淭here have been rumours floating around the City, but the position of the company is that we don鈥檛 comment on speculation.鈥� However, one analyst said: 鈥淚 would bank on a management buyout. The firm may well be saying to itself, 鈥榬ather than having annual general meetings and analysts mauling over us, let鈥檚 go private because it would be cheaper and less hassle鈥�.鈥� Another said: 鈥淚t is the latest in a list of rationalisation movements at the smaller end of the sector. Institutions no longer have an interest in companies of that size.鈥� It is unclear whether the Try family would buy back the whole firm or sell its stake to the management.
One analyst said: 鈥淢y bet would be that the Try family would exit into the sunset if the rumours are true.鈥� Try finance director Frank Nelson refused to comment and chairman Hugh Try was unavailable for comment.
Try鈥檚 pre-tax profit rose 53 % to 拢3.41m in the year to 31 December 1998, and earnings per share were up 66% at 4.6p. Operating profit from contracting activities rose 30% on the previous year, and the acquisition of Amey Homes in October helped its housebuilding business increase operating profit 63% to 拢3.59m.
Try said: 鈥淲e expect our results for the first half of 1999 to show a marked improvement on the previous year and that we will continue to show progress in the second half.鈥� One analyst said: 鈥淭he contracting business has done a lot of negotiated work and has a pretty reliable, if not spanking, record.
鈥淏ut it has two problems. One is its size and the other is that the combination of housebuilding and contracting makes it less attractive to investors.鈥�
