Indigo Capital started buying Regus stock in October 2002 and has regularly added to its stake until it now has more than 60 million shares, or more than 10% of the company. And Cantor Fitzgerald Europe has moved even quicker. It began buying at the beginning of December 2002 and in less than a month had grown its stake to over 10%.

Significantly, both have continued to buy even after Regus was forced into a sale of a majority holding in what is arguable the most successful part of its tattered empire. Just before Christmas, Regus sold a 58% stake in its UK operation to venture capitalist Alchemy Partners for up to £57 million ($90 million). The UK accounts for 92 out of Regus' 400-strong worldwide chain of business centres.

The reason for the sale, according to the company, was continued losses at its US subsidiary, which continues to hemorrhage £2 million ($3,2 million) per month. Regus was due to pay £18.5 million (£30 million) in rent and other quarterly payments at the end of December 2002, which it simply did not have. "The group does not have any overdraft or debt facilities with which to bridge this funding shortfall. Despite efforts to arrange a short-term debt solution, none of the banks and other potential lenders approached were prepared to make available the facility required," founder Mark Dixon--who still owns more than 60% of the buisiness--said in a Stock Exchange announcement.

But observers point out that the UK sale will do nothing to address these problems, and a move to put the US operation under Chapter 11 protection now looks on the cards.