8th Jun 2007 07:00
Alumasc Group PLC08 June 2007 Friday 8 June 2007 THE ALUMASC GROUP PLC Alumasc contracts to sell Brock Metal The Alumasc Group plc (ALU.L), the premium building and engineering productsgroup, announces that agreement has been reached to sell the Brock Metalbusiness, the leading UK supplier of zinc and aluminium die-casting alloys, toChelyabinsk Zinc Plant ("CZP") for cash consideration of £8.15 million, subjectto completion accounts adjustment. The consideration is equal to the net bookvalue of the assets being transferred. Alumasc will retain ownership of Brock'sfreehold factory near Cannock, which has an estimated value of £1.5 million andwill be leased to CZP. All of Brock's existing management team and employeeswill transfer with the business. The sale of Brock, which is expected to complete at the end of June 2007, isstrategically important for Alumasc, enabling increased management focus ongrowing the group's higher margin core premium building and precisionengineering products businesses. The proceeds of the transaction will be used toreduce group borrowings which had increased following the £13.5 millionacquisition of Levolux in May. The transaction will also release aboutone-quarter of Alumasc's existing working capital requirements and significantlyreduce volatility within the monthly working capital cycle, allowing the group'sfinancial resources to be more effectively deployed. CZP raised $368 million last year in an initial public offering of more than 30%of the company's capital on the Moscow and London stock markets and is theleading producer of SHG zinc and zinc alloys in Russia. CZP confirmed in a pressrelease today that the jobs of all Brock employees remain secure. In the year to 30 June 2006, Brock's operating profit was £0.7 million onrevenue of almost £40 million. Brock's gross assets at 31 December 2006 were£12.7 million. Brock's revenue, profitability and working capital requirementshave all increased significantly in the current year driven by a period ofexceptionally high worldwide zinc prices. Commenting on the transaction, Paul Hooper, Chief Executive of Alumasc, said: "The sale of Brock Metal announced today and the acquisition in May of Levolux,the UK's leading provider of solar shading and control systems used incommercial and public buildings, each represent significant strategicdevelopments for Alumasc. They demonstrate the group's focus on further growingthe profitability of its core niche premium building and precision engineeringproducts businesses. I believe Brock, under CZP's ownership, should benefit from becoming part of aninternational metals business and I would like to take this opportunity toexpress my gratitude to all the Brock employees for their contribution toAlumasc and to wish them every success in the future." Enquiries: The Alumasc Group Plc 01536 383 844Paul Hooper Bankside Consultants Ltd.Charles Ponsonby 020-7367 8851 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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