13 October 2008

Lowcostbeds on verge of acquisition

Lowcostbeds.com is in advanced negotiations with several companies and is thought to be on the verge of announcing a significant acquisition.

Rumours have been circulating during the past month about consolidation in the bed bank sector, although the company's takeover target is not yet clear.

Lowcostbeds has grown rapidly this year and is looking to take advantage of opportunities during the current economic crisis.

The company reported pre-tax profits for the year to October 2007 of Ã&#pound;308,000 on turnover of Ã&#pound;5.5 million, compared with Ã&#pound;141,600 on turnover of Ã&#pound;3.8 million the previous year.

The companyÃ¢â¬â¢s sales exceeded Ã&#pound;10m in July, up 40 per cent on the same period last year, and it is backed by the investment arm of Close Brothers, which is believed to be one of the few British banks with a strong balance sheet.

In April 2008, Lowcostbeds invested in a new technology platform iVector from Intuitive Systems, which has increased the speed of bookings on its website.

Lowcostbeds founder and chief executive officer Paul Evans refused to be drawn on the acquisition target but said:

Ã¢â¬ÅâœWe are in advanced discussions with a number of parties about getting together and exploiting synergies to grow our business.

Ã¢â¬ÅâœWe see the current difficulties in the industry as a significant opportunity for us to consolidate our position and grow our business profitably.Ã¢â¬~

By Jeremy Skidmore (www.jeremyskidmore.com)