Alan Sugar is setting up a new Amstrad division to sell DIY beauty appliances.
Sugar, founder of Amstrad, chairman of Tottenham Hotspur FC and PC-to-phone entrepreneur, is understood to have invested millions of pounds in the new operation.
The division, to be headed by Amstrad UK managing director Bordan Tkachuk, will not be branded under the Amstrad name, but will be part of the Amstrad group.
Insiders say Amstrad will launch its first beauty product by September. It is thought to be a facial toning system. This electronic device sends electric currents into the face to tighten facial muscles. It will be marketed as an alternative to face-lift surgery.
A similar machine is already available in the professional market, where it costs salons about 5,000. Clients are charged about 40 a session.
Insiders say Sugar has instructed Amstrad’s technical team to copy the machines and develop a version which will sell for about 200.
Amstrad will not comment on the venture, which it had hoped to keep under wraps until
Mustoe Merriman Herring Levy – which resigned from the Amstrad roster last November after disagreements over strategy – is believed to be handling the new division’s advertising.
Sugar’s new venture faces a difficult task in breaking into the market. CACI International, which sells professional facial toning systems, has only 500 systems installed in the UK. Home systems such as Sleek Cheeks and Isolift are already available, but sales are sporadic.
There has also been negative press coverage because the over-use of some systems can cause skin burns.
But analysts say Sugar may have the Midas touch. “He seems to have the ability to spend his cash wisely,” says Hoare Govett analyst James Heal.
Although Amstrad’s half-year results (reported in February) showed its older consumer electronics division was still ailing, more recent ventures, such as selling mobile phones via its Dancall subsidiary, have proved successful.