Reflex Group shares were suspended yesterday after the company announced a management buyout of its entire operation, headed by managing director Mr Harish Umradia, for an undisclosed sum.

The proceeds from the sale of UK-based First Rental Ltd, which comprises all the operation of Reflex Group, will be used by current chairman Mr Tony Kilduff and the board to buy a new UK company, which will operate in a different business sector.

"Small and static" was how Mr Kilduff described the Reflex operation, which is in the computer rental business.

"The group is capitalised at less than #10 million (#7.9 million) and reported revenues of #3.66 million last year.

"We are selling First Rental to the management because it isn't growing and it isn't developing and, without being too critical of the sector, if you follow our results for the last few years they are pretty static," Mr Kilduff said.

He said this left the group with cash to buy another UK company, which has already been identified.

Reflex Group would be giving up its listing on both the London and Irish stock exchanges and planned to move to London's Alternative Investment Market (AIM), because AIM was a better market for smaller companies, Mr Kilduff said.

If everything goes ahead as planned, the company will publish a circular in about four weeks giving details of changes.

An extraordinary shareholders' meeting will be called in early July to secure shareholder approval for the buyout.