10th Sep 2014 07:45
LONDON (Alliance News) - Air purification equipment supplier Corac Group PLC Wednesday said one of its subsidiaries has signed a heads of terms with Spirax-Sarco Engineering PLC under which the latter will manufacture steam microturbines and compressors following a successful pilot programme by the pair under a joint-development deal.
Corac Energy Technologies, or CET, and FTSE 250-listed Spirax-Sarco signed a joint development deal in November 2012, under which the Corac unit designed and built prototype expanders and compressors. Following the joint testing programme, the first of the products designed under the deal is now ready to move into manufacturing. The manufacturing, distribution and selling of the product will be handled by Spirax-Sarco.
The heads of terms outlines the principles by which the manufacturing and production agreement between the companies will be negotiated.
"The products developed under the initial joint development project will form part of our strategically important focus on Thermal Energy Management solutions, through which Spirax-Sarco is helping its customers to save energy and reduce their energy bills. The innovative products that have been created through joint development with Corac will provide good commercial opportunities for both companies," said Spirax-Sarco Chief Executive Nick Anderson.
"We are delighted to reach an agreement with Spirax-Sarco to move towards the first commercial manufacturing of CET's technologies. This is a big step forward for the company and recognises the potential for these products on the global stage," said Corac Chief Executive Phil Cartmell.
Spirax-Sarco shares were down 0.8% to 2,902.00 early Wednesday, while Corac shares were up 5.6% to 6.60 pence, putting it among the top-ten risers in the AIM All-Share index at the open.
By Sam Unsted; [email protected]; @SamUAtAlliance
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