Hornby steams in to save James Bond at Corgi

Hornby, the model train maker, has vowed to breathe new life into another of Britain's classic toy brands after buying Corgi yesterday for £7.5 million, reports Times Online

Two years after saving Airfix from collapse, Hornby said that it was confident it could revive a brand famed for die-cast models of the Batmobile and James Bond's Aston Martin DB5 - complete with ejection seat.

While still revered by collectors across the UK, Corgi's owners put the business up for sale after struggling to pay suppliers and introduce any new products this year.

Frank Martin, chief executive of Hornby, said: “It is a fanastic brand and has a superb reputation worldwide. We intend to build its premier position in the market. The strategic fit with our existing business could not be better.”

Under the deal Hornby is paying US-based Corgi International £7.5 million for the brand, tooling and intellectual property rights to Corgi Classics. It will also pay £800,000 for all existing stock.

Hornby has undergone a transformation in recent years after switching the manufacturing of its model trains to China and introducing more modern versions of classics such as Scalextric.

It has also increased sales by targeting younger customers through licensing deals. One of Hornby's best-sellers has been a version of the Hogwarts Express that featured in the Harry Potter films.

Among the first new Airfix products released by Hornby last year were kits of Dr Who and the Tardis.

The acquisition of Corgi comes nearly 40 years after Hornby sold its own die-cast model car business, Dinky.

Corgi was founded by the Mettoy Company in Northampton in the late 1930s but the first die-cast models were not made until 1956. At its height it sold millions of toys a year.

Nearly four million people bought the James Bond Aston Martin DB5 in the first three years after it was released in 1965 and a rare gold-plated model was recently auctioned for £1,300.

Mattel bought the business in 1990 but a management buyout saw it return to the UK before Corgi International acquired it in 1999.

A team of ten people still work at the Corgi Classics head office in Leicester.

Mr Martin said his priority was satisfying the pent-up demand in the UK for Corgi classics but that he also wants to generate far more from exports to the US and continental Europe. Corgi's sales have fallen to £6.5 million a year from as high as £18million in the late 1990s.

Mr Martin said: “The core business of Corgi is the adult collector but one of the opportunities we have is to broaden the market by taking the brand to a younger audience.”

He added: “There is definitely still a place for these brands. I still don't think that there is any substitute for the physical act of collecting these models, holding them and putting them in a display case.”

Lindsey Amrani, editor of Model Collector magazine, said: “Everyone will be relieved - there's been a lot of speculation about the fate of Corgi and no models have been released this year. Hornby recently declared record profits and they have taken Airfix on and turned it around, so I think it will be a very good thing indeed.”

Hornby shares, which have fallen 11per cent in the past month, rose nearly 4 per cent or 7p to 171p.

Sanjay Vidyarthi, retail analyst at Dresdner Kleinwort, said: “The strategic fit is excellent and we had long viewed Corgi as a natural target.”

James Bond’s Aston Martin DB5 was Corgi's number one best seller. It's original price was 9s 11d and fatured ejection seat, flip-up roof, rear bullet-proof shield, hidden machine guns.

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