The Alumasc Group plc announces the sale of Alumasc Dispense to management
The Alumasc Group plc (ALU.L), “Alumasc” or “the Company”, the premium building and engineering products company, is pleased to announce the sale of Alumasc Dispense to management, effective today.
As a result of Alumasc’s strategic focus on sustainable building product and precision engineering activities, the Board has decided that Alumasc Dispense, the group’s drinks dispensing business, is no longer a core activity.
Following discussions with a number of potential purchasers, agreement has been reached to sell the business to management at net asset value of approximately £0.9 million, of which £0.3 million has already been received and the remainder is due by 30 June 2011. In addition, subject to certain sales thresholds, Alumasc has the right to receive future royalty fees for sales of new products currently under development that use wireless energy transfer and 3-D technology.
Alumasc Dispense has been operating in difficult market conditions for the last two years. As a result of actions taken by management and a recent market improvement, the business has remained cash flow positive and was expected to recover to generate a small profit in Alumasc’s financial year to 30 June 2011. Consequently, the sale will not have any material impact on the Board’s full year expectations for Alumasc’s underlying profit before tax from continuing operations.
As from today, Alumasc Dispense has been renamed ADS2 Brands Limited.
The Alumasc Board would like to thank all of the former Alumasc Dispense management team and employees for their contribution to the group over many years, and wish them every success for the future.
Alumasc has agreed with its Pension Trustees to contribute half of the net proceeds of the sale to the Company’s pension schemes, both of which are now closed to future accrual. Together with the planned contribution of £0.6 million arising from the recently announced disposal of surplus land, additional one-off contributions made to the pension schemes this financial year will be £1.0 million. This will allow the group’s ongoing regular deficit contributions to reduce from £2.3 million per year to £2.0 million per year for the next two financial years.
Paul Hooper, Chief Executive, commented “The divestment of Alumasc Dispense and the sale of surplus land announced two weeks ago have together generated a total of £2.1 million in cash from non-core assets, and this is consistent with the group’s increased strategic focus on its Sustainable Building Product and Precision Engineering activities.”
The Alumasc Group plc
Paul Hooper (Group Chief Executive) Tel: 01536 383821
Andrew Magson (Group Finance Director) Tel: 01536 383844
Simon Bloomfield Tel: 0207 367 8861