Jefferson Smurfit Group is expected to write to up to three bidders next week informing them that they have been short-listed for the sale of Smurfit Finance & Leasing. The company is expected to fetch around £35 million (€44.4 million).
Smurfit Finance is a leasing and hire purchase company which provides lease and hire purchase facilities to more than 50 motor dealerships and the consumer market. It is expected to make pre-tax profits of £3.3 million this year, compared to £3.13 million in 1998.
Some sources said yesterday that three companies had been short-listed - Equity Bank (seen as a very strong contender), Friends First and Banque National de Paris (BNP). There was some surprise that Friends First was so interested but it is thought that the company is intent on strengthening its position in the marketplace.
Equity Bank is a subsidiary of the Bank of Scotland Group. The company has assets of £700 million and posted pre-tax profits of £6.1 million for the year to end of February last, a rise of 47 per cent on the previous year. Industry sources also said that Woodchester, now owned by GE, should not be discounted.
It is believed 10 parties expressed interest in Smurfit Finance. At the end of December last, the company's total hire/purchase assets outstanding was £64.3 million. This excluded Smurfit group lease assets of £9.6 million. The company provides car leasing facilities to Smurfit group companies in Ireland.
The leasing company underwrote £1.3 million of new business for the Smurfit group last year. The group has given an undertaking that it will give Smurfit Finance's buyer first refusal on its Irish and British motor leasing requirements for an agreed period of time.
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