Molins PLC - Sale of Sandiacre Rose Forgrove
The sale of SRF is conditional on the completion of information exchange and consultation with the UK based employees of SRF, in accordance with legislation.
01/12/06 The Board of Molins PLC, the international specialist engineering group, together with its wholly owned subsidiary Molins Richmond Inc., has entered into a contract to sell its Sandiacre Rose Forgrove packaging machinery business based in Nottingham, UK and Pennsylvania, USA. The sale of SRF is conditional on the completion of information exchange and consultation with the UK based employees of SRF, in accordance with legislation. It is expected that the sale will be completed before the end of the year. The freehold property from which SRF operates will be retained and leased to the purchaser.
The UK part of SRF is being acquired by Hayssen Europe Limited and the US part by Hayssen Inc. (collectively “Hayssen”), both being subsidiaries of Barry-Wehmiller Companies Inc., based in St Louis, Missouri, USA, for a cash consideration of £3m payable on completion. A subsequent adjusting payment will be made or received, to reflect the movement in the value of the working capital between 30 September 2006 and completion. The cash proceeds will be used to reduce the Group’s external debt. At 30 September 2006, the book value of the gross assets of SRF was £7.0m and, after deduction of liabilities to be transferred, the book value of the net assets was £4.8m. The transaction will result in a book loss of approximately £2.0m before taxation and after expenses of £0.2m. Operating losses at SRF were £1.0m in 2005 on sales of £14m and £1.2m in the nine month period to 30 September 2006 on a reduced level of sales.
As a separate transaction Molins intends to market and sell the property which is held in the books at £1.8m. The property has an estimated market value in excess of £4m.
