Corporate raiders set sights on Novar split

The building materials conglomerate Novar yesterday dismissed calls to rethink its strategy after its biggest shareholder UK Active Value urged the company to consider floating one of its divisions.

The building materials conglomerate Novar yesterday dismissed calls to rethink its strategy after its biggest shareholder UK Active Value urged the company to consider floating one of its divisions.

The company, which refused to comment on the public spat yesterday, is thought to have dismissed the fund's request, particularly since it believes it has secured the backing of its other significant shareholders.

"There were no indications of discontent from other shareholders," said one City source. He dismissed the unrest as a "wind-up exercise".

UK Active Value, which owns 15 per cent of Novar, announced it had written to Juergen Hintz, the chief executive, urging him to consider a partial flotation of the company's security printing services division.

Julian Treger, the head of the fund, said Novar should consider "a partial flotation or a possible sale to management, perhaps even supported by the Active Value Funds".

The move comes just a month after Novar took the division off the market after deciding it would not get a decent price in current markets. Only weeks before, it said the sale was well under way and that it had received a raft of approaches.

UK Active Value, however, firmly believes the division does not fit within the group and should be floated or sold to create shareholder value.

"Novar remains a collection of three unconnected businesses. This situation must be addressed if the inherent value of the group is to be realised to your shareholders," the fund wrote.