10/16/2008 11:41:00 AM
Strax in trouble after failure of Icelandic bank backer, Landsbanki
The future of accessories distributor Strax has come under speculation after it emerged that Landsbanki, one of the recent high-profile failed Icelandic banks, is a major investor in the mobile company.
Strax has denied that it could suffer from the Icelandic economic turmoil, despite Landsbanki having been nationalised last week and requiring a £4bn handout from the Russian government to stabilise the business amid cashflow problems.
Suspicions that the accessories distributor could hit the rocks were aroused when it emerged that Landsbanki, Iceland’s second largest bank, had gone into receivership. The bank has since been bailed out after the Icelandic government took control of it.
Strax could still face a struggle despite the intervention as it is part-owned and heavily financed by the bank. An industry source told Mobile: ‘Strax is very closely associated with the Icelandic banks, and around 50% [of Strax] is owned by them. Most of the directors are Icelandic and one of them recently left the company to work at an Icelandic bank.
‘Any large company like Strax requires a huge amount of borrowing, so this will have hit them hard.’
However, the distributor has denied these suggestions. Nick Pratt, Strax’s UK finance chief, told Mobile: ‘Strax is not affected by this situation with Landsbanki nor with any other of the UK and EU banks that are dealing with the global liquidity crisis.
‘We have enjoyed a long and successful association with Landsbanki that dates back to when they were originally government owned, prior to their privatisation in 2002. So, from our point of view it is very much business as usual.’
Three of the four companies listed as investors on Strax’s website – Landsbanki, Bru (owned by Thule Investments) and Eyris Invest – are Icelandic firms. The other investor is Swedish firm Novestra. Strax has offices in 17 countries, spanning four continents.
In the UK, Strax supplies the dealer market, as well as supermarkets and other non-specialists, with accessories. The company is regarded as one of the stronger and more professional outfits in the accessories distribution sector.