THE computer services company Reflex says it could open its first Internet cafe within six weeks after shareholders yesterday approved the raising of £1 million to fund the venture.

Reflex is paying £150,000 for Hands On, a British company which has developed the concept for a chain of Internet cafes. Hands On has yet to trade and its only assets are a nominal cash holding and its business plan for the development of the cafe chain.

Hands On has already identified four sites for its cafes and hopes to open its first outlet in London in the near future. Manchester is the favoured location for its second cafe, and up to 12 outlets could be opened by the end of this year.

Hands On will rent most of its computer hardware from another division of Reflex and this should result in cost savings, according to the company.

After the company's annual general and extraordinary general meetings yesterday, Reflex executive chairman, Mr Tony Kilduff said it would be important to "do the coffee well". Reflex was currently in negotiations with a number of suppliers, he added.

The owners of Hands On, Mr Bev Ripley and Mr Terry Norris, who developed the British video group Ritz which was subsequently sold to Blockbuster, have been co opted to the Reflex board and, under new service contracts, will be paid annual salaries of £60,000 sterling each.

A company which administers the pension schemes of Mr Ripley and Mr Norris has agreed to buy four million new shares in Reflex for £400,000, and shareholders at yesterday's extraordinary general meeting also approved the raising of £620,000 through an open offer of one new ordinary share for every four held.

Later, in a statement, Reflex said that the open offer had been successfully completed, with 83 per cent of the shares taken up by qualifying shareholders. The chairman, Mr Kilduff, took up his full entitlement of 1.99 million shares at a cost of £199,000, bringing his stake in Reflex to 25.1 percent.