Danka avoids US parent's plight

Danka avoids US parent's plight

Office equipment reseller Danka has moved to distance itself from reported financial problems with its US parent.

John Parsons, Danka Asia Pacific's managing director, moved to head off any rumours which link the Australian and New Zealand operations with the troubled US organisation.

Following a decline in its share price, Danka's US headquarters issued a statement regarding a potential breach of banking covenants and the hiring of an investment bank to evaluate ways to improve shareholder value. The share price fall was reportedly associated with short-term problems arising from the takeover of the photocopying division of Eastman Kodak in 1996.

Parsons reaction was: "Danka Asia-Pacific is part of the international division and whatever eventuates in the United States will have no effect on us whatsoever. Our clients should have no concerns about our ability to supply and service their needs in Australia and New Zealand.

"Danka Asia-Pacific is trading profitably and is ahead of budget," he added. "In fact, the overall international division is 15 per cent ahead of budget after five months. Danka is a strong company with an annual turnover of more than $US3 billion and I am sure that these short-term problems will be resolved."

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