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Photo-Me hires adviser for looming break-up

Photo-Me International, the photo-booth and digital imaging company, has appointed Lazard & Co as an external financial adviser to orchestrate a potential break-up of the business.

The company, which walked away from bid talks before dropping out of the FTSE 250 last year, announced in December that it would consider selling its vending and wholesale and minilab manufacturing businesses separately, in what is widely thought will be a trade sale.

The appointment of Lazard, which will work alongside JPMorgan Cazenove, the group’s existing financial adviser and joint broker, marks the start of a strategic review that could lead to a sale of one or all of the three businesses, Photo-Me said.

JPMorgan Cazenove is at the same time advising Photo-Me on a return of capital, which will give investors around 30p a share.

Vernon Sankey. the chairman, has suggested that Photo-Me may sell its vending division first, but stressed that a good price is expected.

Photo-Me has struggled because of changes in the photographic industry, including a shift to biometric passports. Results from its manufacturing division, which has been plagued by equipment-related delays, are forecast to improve.

Charles Peacock, an analyst at Seymour Pierce, said: "The board committed to pursue strategic options for the individual businesses and, in our view, this is welcome. The different attributes of the two operating divisions, vending and manufacturing, lend themselves to separate strategies.

"There would be few, if any, industry buyers for both divisions. Competition ... would therefore have existed primarily among private equite groups who would be less well placed to extract cost synergies from an acquisition," he said.

Photo-Me has leading positions in the photo-booth market in France, the UK and Japan.

Its shares were unchanged in early trading today at 86p.

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If the above artical makes interesting reading, this is better:-

A shareholder in Photo-Me International has asked the Financial Services Authority to investigate the sale of shares by three directors in the weeks leading up to a profits warning.

Shares in Photo-Me International plunged 23pc last Friday after the company issued a warning last week.

Vernon Sankey, chairman of Photo-Me International, admitted that "the timing did not look good" but strenuously denied any suggestion of wrongdoing.

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He said: "I have examined the authorisations. They all had proper authorisation. It looks bad, but none of them had any inkling of the profit warning."

All three directors exercised share options in the weeks ahead of the profit warning and immediately sold the shares.

On February 6 Jean-Luc Peurois, the finance director, exercised all of his outstanding share options, paying 35.3p for 250,000 shares which he then sold for 89p a share, realising a gain of £134,184. A couple of weeks later, on February 20, executive directors Francois Giuntini and Riccardo Costi sold a combined 637,500 shares, 10 days before the profits warning

Mr Giuntini exercised all of his outstanding 262,500 options and sold the shares for 82.5p, realising almost £100,000. Mr Costi exercised 375,000 options, realising almost £112,000.

Shares in Photo-Me International rose 2½ to 62½p.

A private investor in Photo-Me International, who owns 50,000 shares and asked not to be named, said: "I have raised a formal complaint to the FSA and requested a thorough investigation of the actions of these three directors."

Photo-Me, which makes and operates photo labs and vending machines, said last Friday it had sold fewer of its "minilabs" than expected.

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I was always of the idea that Photo Me International made all its $£$ buying and selling shares in itself.

They have been an up-down penny share for years, and now that their mainstay photobooth kiosk business is challenged by recent regulation over id pic specs, and the mini-lab bubble has burst, - I wonder what they have left.

To their credit, PMI is a surviving company, - wonder what the future holds for them ..... another big fire ?

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