Shareholders of clothing manufacturer Dewhirst have overwhelmingly accepted a buy-out offer for the company from a team led by members of the Dewhirst family.

Kirkgate Group Ltd - the company set up by the buy-out team - has revealed that it now has acceptances which will provide it with just over 74 per cent of the existing issued share capital.

The buy-out offer of 85p per share values the company at £112.7 million and was recommended to shareholders by independent directors of the group. They expect the company's disappointing stock market performance to continue - largely because of the company's reliance on Marks and Spencer. Some 86 per cent of Dewhirst's turnover is dependent on the high street giant. They are also worried about further rationalisation in the UK clothing industry and low investor interest in small quoted UK textile firms.

The buy-out deal has been put together by Dewhirst family members and other directors of the company. They are Timothy Dewhirst, David Witt, Scott Beattie, James Dewhirst, Ian Dewhirst, Brian Farrow, David Stonier and Michael Terry.
They have arranged debt financing totalling £98 million with HSBC and IBJ to finance the offer and provide working capital.

The closing date for the offer was yesterday. By that time Kirkgate had secured agreement for just over 50 per cent of the company's shares. Together with shares already secured outside the offer, it provides Kirkgate with 74.18 per cent of Dewhirst's share capital.

The offer deadline has now been extended for another 14 days for shareholders who have not so far accepted the terms. The new deadline is 3pm on August 23.

By Clive Hinchliffe.

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