Parts of troubled property consultant likely to be sold off if takeover talks lead to an offe

Property consultant Erinaceous could be dismantled and parts sold off if a takeover deal goes ahead.

American hedge fund Fursa this week increased its stake to 18% after it emerged that Vincent Tchenguiz’s Consensus Business Group (CBG) was in talks that could lead to an offer.

CBG said in a statement: “Discussions between CBG and Erinaceous are at a very early stage and CBG is considering all of the options available to it, which may include an offer for Erinaceous.”

It is understood Tchenguiz is considering merging Erinaceous’ property management division with one of his companies. This may lead to a tie-up with Solitaire, his residential services group, or Peverel, his retirement homes management firm. He is likely to sell the rest of the firm to trade buyers.

Fursa, which declined to comment on the purchase, led successful shareholder demands for the removal of Neil Bellis, the chief executive, and Michael Pearson, the finance director. Bellis stood down last week to become executive deputy chairman and Pearson resigned.

Shares in the group, which is listed on the alternative investment market, have fallen more than 80% in the past 12 months, from a year high of 392p to about 41p this week, valuing the firm at about £45m.

Last week Erinaceous warned that it was facing collapse after revealing pre-tax losses of £3.1m for the six months to the end of June, against a £12m profit last time. Net debt at the company has more than doubled to almost £170m.

The renegotiation of its banking facilities last week means the interest rate on its debt is now understood to be almost 10%.

Richard Steer, senior partner at rival QS Gleeds, blamed the firm’s extensive acquisition spree for its difficulties. “In essence, they are offering a too diverse range of services for a demanding market,” he said.