A flurry of acquisitions is forecast in the UK timber products industry during 2005, with 275 cash rich companies poised to snap up competitors.
The prediction comes from industry analyst Plimsoll Publishing which has identified 124 companies as acquisition prospects. These include some of the smallest and largest in the industry with each showing symptoms of financial stress.
According to Plimsoll, the average level of debt for these companies is 17% of turnover, but it maintains that each business could be turned round in a short space of time.
David Pattison, senior analyst at Plimsoll, said the companies under pressure are running out of options and added: “With so many cash rich companies operating in the market, selling up might be the only sensible option left. By acquiring and clearing the debts of any one of these struggling companies, a cash rich company could become the proud owner of a profitable business
