Business
Re: Sale
Re: Sale.
About this update from Mpac Group Plc
[{"type":"text","content":"\n Molins PLC\n28 November 2006\n\n28 NOVEMBER 2006\n\n\n FOR IMMEDIATE RELEASE\n\n\n\n MOLINS PLC\n\n SALE OF SANDIACRE ROSE FORGROVE\n\n\n\nThe Board of Molins PLC, the international specialist engineering group,\ntogether with its wholly owned subsidiary Molins Richmond Inc., has today\nentered into a contract to sell its Sandiacre Rose Forgrove packaging machinery\nbusiness ('SRF') based in Nottingham, UK and Pennsylvania, USA. The sale of SRF\nis conditional on the completion of information exchange and consultation with\nthe UK based employees of SRF, in accordance with legislation. It is expected\nthat the sale will be completed before the end of the year. The freehold\nproperty from which SRF operates will be retained and leased to the purchaser.\n\n\n\nThe UK part of SRF is being acquired by Hayssen Europe Limited and the US part\nby Hayssen Inc. (collectively 'Hayssen'), both being subsidiaries of\nBarry-Wehmiller Companies Inc., based in St Louis, Missouri, USA, for a cash\nconsideration of £3m payable on completion. A subsequent adjusting payment will\nbe made or received, to reflect the movement in the value of the working capital\nbetween 30 September 2006 and completion. The cash proceeds will be used to\nreduce the Group's external debt. At 30 September 2006, the book value of the\ngross assets of SRF was £7.0m and, after deduction of liabilities to be\ntransferred, the book value of the net assets was £4.8m. The transaction will\nresult in a book loss of approximately £2.0m before taxation and after expenses\nof £0.2m. Operating losses at SRF were £1.0m in 2005 on sales of £14m and £1.2m\nin the nine month period to 30 September 2006 on a reduced level of sales.\n\n\n\nAs a separate transaction Molins intends to market and sell the property which\nis held in the books at £1.8m. The property has an estimated market value in\nexcess of £4m.\n\n\n\nBackground on Sandiacre Rose Forgrove\n\nSRF, which employs 130 people, comprises the businesses of Sandiacre Packaging\nMachinery, acquired by Molins in 1994 and Rose Forgrove, acquired from\nreceivership in 2001. SRF is a manufacturer of vertical and horizontal form\nfill and seal bagging and wrapping machines and sells principally into the food\nand other fast moving consumer goods industries.\n\n\n\nReasons for the Sale\n\nSRF operates in a very competitive...