Credit crunch delays Boundary Capital plans

THE global credit crunch has hit Boundary Capital’s plans to sell off its golf and fitness club business.

Boundary, the listed investment vehicle controlled by Niall McFadden, is the owner of the Club Company, which operates 11 golf and fitness clubs in Britain. These were purchased last year and Boundary had been planning a sale and leaseback of the clubs.

“Events in credit markets over the summer have meant that these plans have now been delayed. The company continues to trade well and on budget,” Boundary said in a statement to the stock market.

The clubs were bought in a deal worth about €85 million but Boundary was hoping to raise more than €130m through the sale and leaseback.

Boundary yesterday agreed to increase its shareholders in school book publisher CJ Fall and printing firm Kall Kwik and Prontaprint for €11.2m. Boundary upped its stake in the company behind these firms from 19.2% to 67.2%.

Mr McFadden said the planned increase in its shareholding will be funded from the proceeds of Boundary’s flotation on Dublin IEX exchange earlier this year and was in line with the strategy to invest in cash generative companies with established trading track records.

“All of the businesses are very well positioned in their respective markets. Boundary Capital has a clear objective to build a balanced portfolio of investments across a number of sectors and this development, coupled with a number of other attractive opportunities we are currently reviewing, gives us confidence for the future.”

Boundary also released its interim results yesterday showing its net asset value at end of June had fallen to 94 cents compared to a flotation price of €1. The company said 4c of the drop was related to the cost of the listing with the remaining 2c was due to a fall in the value of its quoted investments. Boundary has substantial stakes in the listed firms Veris and SiteServ.

Its has also spent €2.46m to acquire a 31.3% stake in an property investment in the Netherlands.