10th May 2007 07:15
Weir Group PLC10 May 2007 THE WEIR GROUP PLC 10 MAY 2007 THE WEIR GROUP PLC AGREES THE SALE OF ITS INTEREST INDEVONPORT MANAGEMENT LTD TO BABCOCK FOR £86 MILLION The Weir Group PLC ("Weir"), the global engineering group, announces today thatit has agreed to sell its 24.5% interest in Devonport Management Ltd (DML) toBabcock International plc ("Babcock") for a cash consideration of approximately£86 million. DML was established in 1987 to run Devonport Royal Dockyard, which it thenacquired in 1997. It offers a complete range of design, build and supportsolutions across both defence and commercial sectors, including nuclearsubmarine refit and maintenance. Commenting on this transaction today, Weir Group chief executive Mark Selwaysaid: "Devonport Management has been a very good investment for Weir and we arepleased to have played a part in the success of the enterprise. However,long-term involvement in DML is not core to our strategy and a sale on the termsagreed represents excellence value for our shareholders. This sale places thecombined Babcock and DML businesses in a primary position to achieveconsolidation of UK submarine assets." The profits after tax attributable to the interest disposed of by Weir for theyear 2006 were £8.1million. The gross value attributable to the assets beingdisposed of by Weir was £73 million at 31 December 2006. The disposal will lead to an exceptional profitof approximately £50 million in Weir's 2007 accounts. The cash proceeds will be used to continue to develop Weir's business in linewith its stated strategy to grow specialist higher margin businesses in oil,power and mining. The other shareholders in DML are KBR (51%) and Balfour Beatty (24.5%). Thetransaction is conditional upon the approval of the Ministry of Defence and theshareholders of Babcock. It is anticipated that the transaction will becompleted in about 60 days. Contact details: The Weir Group PLC 0141 637 7111Helen Walker, Public Relations Manager 0141 308 3739 (Mobile: 07789 032296) Maitland Tel. 020 7379 5151Suzanne Bartch (Mobile: 07769 710 335)Peter Ogden (Mobile : 07811 124 197) This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Weir GroupBabcock