28th Jul 2021 14:00
(Alliance News) - Tricorn Group PLC on Wednesday said discussions to sell the company are ongoing, as certain restrictions on the firm are now being imposed by its lending bank.
Shares in Tricorn were down 10% to 4.50 pence each in London on Wednesday afternoon.
As part of Tricorn's strategic review, the Malvern, Worcestershire-based tube parts manufacturer is considering the sale of the company to be conducted under the framework of a "formal sale process" in accordance with the takeover code, or the sale of one or more of the company's operations.
The company and its advisers have engaged in discussions with a number of parties, with such discussions ongoing.
Tricorn said it has "experienced an extended period of challenging markets and turbulent trading," with disruptions to supplies, amid a systemic issue across global manufacturing, continuing to impact the company.
"Whilst customer demand is steadily improving and pass-through of prices increases to customers have in part been negotiated and continue to be discussed, the pressure on operating costs, margins and working capital in the near term continues, particularly as supply chain terms tighten and overdue debts from customers remain outstanding," the firm said.
Tricorn said it has continued to operate within its borrowing facilities, however, the company's near term cash requirements have been adversely affected and there may be a requirement to operate beyond its existing facilities.
Whilst the firm's principal lending bank is expected to "remain supportive", some restrictions on loan facilities are being imposed. It is expected that these curbs would be eased in the event of a successful sale of one or more of the company's operations or an injection of funds.
By Amrit Sahota; [email protected]
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