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TWST: Can we begin with a quick historical sketch and overview of Ashtenne Holdings (LSE:AHH.L) ?

Mr. Watson: Ashtenne is an industrial property company specializing primarily in buying, managing intensively and then profitably selling industrial property in all guises, but typically either large portfolios of property or individual estates. In the UK when we talk about industrial property, we talk about a very wide spectrum of property from start or nest units, which could be as small as 1000-2000 square feet up to 200,000-300,000 square feet units for distribution. But our units tend to fall in the 1,000-50,000 square feet range really. We don’t go for what’s called big box distribution units. So ours are everyday industrial units occupied by family businesses, principal led businesses.

TWST: Is the customer base diverse? When you say you specialize in the industrial property space, what type of tenant falls into this category?

Mr. Watson: It’s a good point. It you are not familiar with industrial property, you may envisage huge smoke belching, chemical works or steel plants. When we are talking about industrial property, we are talking about what crudely speaking is four walls and a roof, a single story building with a portal steel frame. And it is the most flexible building of all the sectors. And you can do anything in this shed – in the UK we call them industrial sheds or sheds for short. We literally have the butcher, the baker, and the candlestick maker. We have every kind of commercial use and activity in our buildings. We have a bit of every thing really from very low tech -- the man who bolts the exhaust on your car -- through to light industry, packaging, repackaging, light assembly, straightforward haulage and distribution. Some are even fitted out as offices because you put a lowered ceiling in and you can effectively use them as offices. Indeed, that’s a current trend at the moment. Call centers, for example, which you might imagine going into offices, have typically in the UK gone into industrial buildings that have been fitted out because they are the lowest cost form of occupation. And likewise a lot of the big banks are now looking and some are actually putting their back office operations into fitted out sheds for the same reason -- everybody is under margin pressure and this is the most economical property to occupy.

TWST: As we look to the next couple of years, what is the strategy going to be and what accomplishments will make this timeframe a success for Ashtenne?

Mr. Watson: Last year was a pivotal year for us. We have always made excellent returns; we made 20% plus per annum up to 1996 when we floated, and we have made 26% plus per annum since 1997 as a public company. But last year was pivotal because we effectively restructured the business in the two halves. We have got very solid income coming out of one half and we have got the other half, which we see as a driver for capital growth. Looking forward two years, the ideal thing would be for the fund management arm to have grown materially by raising more funds into the funds, particularly the Ashtenne Industrial Fund, which is the fund are set up with Aviva. We would like to think that it could have at least doubled say in two years, certainly put on another 250 million in two years. And then on the other side, if we can have sensibly used our cash or latent gearing to buy some properties and situations with opportunities, that will effectively take the company to the next step of growth. Last year, we bought 2-3 big corporate situations. There was a quoted company in the UK called Ascot Plc, which was bought by Dow Chemicals of the US, but Dow didn’t want Ascot’s non-operational properties. So we bought the property subsidiaries of Ascot and that’s proved to be a fantastically rewarding purchase for us. Another one or two purchases like that would be great.