FIH Group acquires East London industrial estate

British conglomerate FIH Group has purchased a 2.5-acre industrial estate in Leyton to provide its Momart subsidiary with long-term security of tenure.

The Falklands Islands-based outfit acquired the East London site, which consists solely of five warehouses operated by its art handling subsidiary, from its longstanding landlords, H Young and Co, for £19.4m - effectively exchanging its former leasehold interest and associated escalating property rents of £800,000 per annum.

FIH will finance the purchase from its cash reserves and by drawing down upon new secured mortgage facilities.

The group noted it would retain "significant cash resources" following the transaction, allowing it to invest in the future expansion of its other operations - most notably in the Falkland Islands.

Chief executive John Foster, said: "We are pleased to have acquired the Leyton property as this will result in significant savings of annual rent for the group and removes the prospect of a continuing escalation in future operating costs."

"We are confident that over the medium term the purchase will generate meaningful cash savings for the group and will both enhance and improve its quality of earnings."

As of 1150 GMT, FIH shares had picked up 1.10% to 276p.