CBPE announces the MBO of the Industry Ltd. “The Industry” is the UK’s leading supplier of film and other consumable items to the film industry. The Industry is an MBO of the manufacturing and distribution divisions of AIM quoted VFG PLC. The company serves some of the leading names in the UK TV and film industries, including BBC and Granada.

The new company’s management team will be led by CEO David Stamp, and Peter Mountford of Bradmount Investments, who will become chairman.

The distribution division, which trades as The Film Game and Film Stock Centre / Blanx, is market leader in the supply of film, videotape and consumables to the television and film industries in the UK. It sources products from Kodak, Panasonic, Sony and Maxell.

The manufacturing division, which trades as Formatt Filters, has recently completed a £3.5 million development project for a range of advanced filter products for film and TV. These filters use a unique process known as “Absorbing Cell Technology” to guarantee purity of image and were recently supplied and used in the film, Bridget Jones’ Diary.

The Industry had turnover in the year to August 2001 of £12 million and reported pre-tax profits of £0.7 million.

Senior debt financing for the transaction has been provided by The Royal Bank of Scotland.

The Industry employs a total of 59 people based at Wardour Street, London W1, Peterborough, Wembley and at Formatt’s factory in Aberdare, Wales where the company is receiving regional grants from the Welsh Development Agency to further develop the facilities.

Commenting on the MBO David Stamp, Chief Executive of The Industry said:
"We are delighted to be forming the new company, bringing together the undisputed market leader in film stock distribution and the fantastic products of Formatt. It is already clear that there are significant synergies to be gained from two divisions working more closely together ”

Mark Perryman, of CBPE, added:
"The Industry is the seventh investment made by our Fund VI and another, in one of our preferred sectors – value added distribution. This is a great management team and the combination of the market leading position of The Film Game with the revolutionary technology of the Formatt Filters ensures a very exciting future for the company."

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This press release has been issued by Close Brothers Private Equity Limited. Close Brothers Private Equity Limited is regulated by the FSA.

The above information is not to be regarded as an offer to sell, or a solicitation of an offer to buy any security. Where information has been obtained from outside sources, it is believed to be reliable, but is not represented to be accurate or complete.