Redbus slumps on sales shortfall

SHARES in Redbus Interhouse slumped after the data centre firm reneged on forecasts and its founders stepped down from the executive board. The company said after the market closed on Monday that first-quarter sales of £2.62m had missed targets.

The shares tumbled 3 1/2p to 3 1/4p this session, valuing the business at £6m. It was worth nearly £500m two years ago.

Executive chairman John Porter, son of flamboyant ex-Tory leader of Westminster council Dame Shirley Porter, and executive deputy chairman Cliff Stanford, who made his fortune selling Demon Internet to Scottish Power, are moving to non-executive positions.

The sales shortfall wrecks Redbus' forecast that its £15.34m cash is enough to finance it through to breakeven in 2003. The firm, which has spent about £80m building nine so-called internet hotels in seven European countries, will now sell underperforming centres and slash its workforce.

It also faces a £13.9m claim from the landlord of its redundant Luxembourg centre for rent arrears and the cost of a promised fit-out.