Flying Brands' car boot sale continues

Mail order gardening, gift and audio book retailer Flying Brands dragged itself away from a place adjacent to its 52-week low after the hard-pressed firm said has had a number of approaches from parties interested in buying some of the company's businesses.

The share price shot up to 10.5p from 7.75p on the news although, as usual, the company was careful to stress that there is no guarantee that any of the approaches will amount to anything.

However, if they do, the money would clearly come in handy, as the Jersey-based company continues to attack its debt pile. Back in late September the company said it was in danger of breaching its banking covenants after a sharp downturn in trading, prompting a renegotiation of its banking facilities, which was concluded in late October.

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Barclays Wealth agreed an extension to the company's overdraft facility from £800,000 to £1,475,000, at an interest rate four percentage points above base rate. The arrangement cost for this facility was £30,000. The amount is repayable on demand but the facility will expire during December 2011.

A few days later, Barclays Wealth agreed to turn a blind eye to a breach of Flying Brands' banking covenants on its treasury loan facility for the quarter ending 30 September 2011, giving the company time to raise a bit of cash through property sales. This was duly achieved, with the company raising £1.22m from the sale of its Glasshouse premises at Meadow Springs, in Jersey, and a further £2.1m through the sale of part of its premises at Retreat Farm, also in Jersey.

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