11th May 2007 07:01
Elementis PLC11 May 2007 PRESS INFORMATION May 11, 2007 ELEMENTIS PLC Sale of Global Pigments Business Elementis plc (LSE:ELM), today announced that it has agreed to sell its GlobalPigments business headquartered in East St. Louis, USA, to Rockwood SpecialtiesGroup, Inc. for a cash consideration of approximately US$140 million (£70million) on a cash free, debt free basis. Elementis Pigments is a leading producer of synthetic iron oxides andcomplementary products. In the year ended 31 December 2006, Pigments' reportedoperating profit, before exceptional items, was £6.1 million on sales of £94.2million with net assets of approximately £42 million, excluding cash and debt.Gross assets were approximately £61million. After taking account of transactioncosts and estimated net assets at the time of completion, Elementis expects torecord a pre-tax gain on sale of approximately £20 million. This gain will berecorded as an exceptional item in the 2007 financial statements. The price represents an attractive multiple of 2006 operating profit (earningsbefore interest and tax) of 11.5 times. In addition, the transaction is expectedto have no material impact on the Group's 2007 earnings before exceptionalitems, and provides an opportunity to further strengthen the Group's balancesheet to support growth in the Specialties business. Completion is subject to regulatory approvals, including a filing under the HartScott Rodino Act in the United States, and is expected to take place before theend of 2007. Net proceeds from the sale will initially be used to reduce netborrowings, but the Board is reviewing other potential uses and will provide anupdate before completion. David Dutro, Chief Executive of Elementis, commented: "This transaction confirmsthe success of our restructuring initiatives in the Pigments division, which hasdelivered steadily improving results in a highly competitive environment. Thisoffer recognises the value that has been created in this division, and as suchwe believe that it represents an attractive proposition for our shareholders.Completion of this transaction will also be in line with our declared strategicintent to focus more of the Group's resources on the Specialties business." - Ends - Enquiries: Elementis plc Tel: +44 (0)1784 227 000 David Dutro Chief ExecutiveBrian Taylorson Finance Director Financial Dynamics Tel: +44 (0) 207 831 3113 Andrew DowlerGreg Quine This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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