27.07.2009

EPL decision close

KPMG the administrators of EPL the UK based aerial lift rental company are close to concluding a deal to rescue the business.

Neither the Administrators nor the directors of EPL will reveal any details of any discussions that may or may not be going on, however we do understand that three or four proposals and possibly more expressions of interest were received prior to the closing date for such offers.

Most have been offers to acquire all or specific assets of the company, without making a firm commitment to taking on any staff or premises, understandable given the relatively high overheads and employee longevity within the business, making any ‘restructuring’ a potentially costly affair.

We do hear though that an offer for the business (not the company) as a going concern, has been received from a leading UK aerial lift rental company and that this is currently the preferred bid.

Vertikal Comment

If the reports and …to be honest ..rumours…are accurate and this deal is consummated, questions may well be asked regarding a dominant market position within the UK vehicle mounted aerial lift rental market?

It will also be hard for many to understand the strategy of the buyer - taking a competitor out, consolidating the market and expanding market share - unless the acquisition price is so attractive that is offsets the potentially high restructuring costs.

Much will depend on the cost and the terms, EPL has a first class reputation and a solid customer base, it also has a some excellent and loyal people on the payroll that the buyer may wish to retain.

The administrator will of course has a responsibility to the creditors as well as the employees, and while the price for the going concern bid may be lower it is likely to tick more boxes than a higher priced asset purchase.