Director Dealings: Coral deal aids move from CD cases to food packaging

CORAL Products recently predicted that its £4.1 million acquisition of a food container manufacturer would be transformational for the business.

The Liverpool-based company has been moving away from its traditional market of producing CD and DVD cases, where demand is in decline, and chairman Joe Grimmond said he believed the tie-up with Interpack would bring significant benefits for the combined group.

The company has also recently switched to the Alternative Investment Market from the main market and raised £1.8m in a share placing.

A brokers’ note from Xcap said it believed the acquisition would “significantly improve the margins and prospects for the existing Coral business”.

“Food packaging is in itself a better margin business for Coral and was an area the company was already moving into. As a result, there is already a certified production line at the company’s main manufacturing plant at Haydock. The plant also has significant spare capacity at present, so increasing production will not be constrained for the foreseeable future,” the analysts pointed out.

Around 80 per cent of Coral’s current turnover comes from the manufacture of plastic cases for CDs and DVDs.

Last week Grimmond signalled his confidence in the deal by buying 290,000 shares at 12p per share.

He now owns just over 4.5 million shares in the group.

* David Lenigas, chairman of energy group Leni Gas & Oil, has increased his stake with the purchase of three million shares at 1.26p per share. The company recently announced the acquisition of another exploration company, Sorgenia International.

* Frank Meysman, chairman-in-waiting of travel company Thomas Cook, has bought 100,000 shares at 39.09p.

* David Rugg, chief executive of valuation and surveying group Christie, has bought 100,000 shares at 60p a time to increase his stake to 2.6 million shares.

* Two directors at trading software group Patsystems have increased their holdings. Non-executive John Priestley bought 31,316 shares at 12p each to take his holding up to 200,000 shares.

Fellow non-executive Stewart Douglas-Mann bought 50,000 shares at 11.8p each and now holds 250,000 shares.

They bought the shares after a sharp fall in the company’s market value following a disappointing trading update.

* Nicholas Sibley, a non-executive director of gemstone company Richland Resources, has bought 500,000 shares at 8.25p each. He now holds 6.6 million shares.

It is the second time in a month that Sibley has increased his stake.