Business
Disposal of Powered Access Division and GM
Disposal of Powered Access Division and GM.
About this update from Tanfield Group Plc
[{"type":"text","content":"\n \nRNS Number : 5002O Tanfield Group PLC 20 September 2013 \n\n20th September 2013\n \nTanfield Group PLC\n(\"Tanfield\" or the \"Company\")\n \nDisposal of Powered Access Division and GM\n \nHighlights\n \n· Staged disposal (initially 51%) of Powered Access division (the \"Snorkel Division\")\n· Tanfield to hold a US $50million preferred interest in new Snorkel entity, Snorkel International Holdings, LLC (\"Snorkel International Holdings\")\n· Anticipated significant potential to enhance shareholder value through strategic alliance\n· Acquirer to inject working capital to fund Snorkel's recovery\n· Acquirer's existing businesses in related industries to be used to underpin recovery plan\n· Put option for Tanfield to realise its remaining holding on a significant EBITDA multiple\n· Disposal has no impact on Tanfield's holding in Smith Electric Vehicles\n \nThe Board of Tanfield announces that the Company has reached agreement on the terms of a conditional contribution agreement (the \"Contribution Agreement\") to dispose of the Snorkel Division by contributing the Snorkel Division to a new company, Snorkel International Holdings in which the Company will retain a minority interest, with SKL Holdings, LLC (\"SKL Holdings\") owning a majority interest.(the \"Transaction\"). The Company has today published a circular to shareholders (the \"Circular\") to explain why the Independent Directors consider the Transaction to be in the best interests of the Company and its shareholders; and recommend that shareholders vote in favour of the resolutions to be proposed at the General Meeting that is convened for 9.00am on Monday 7 October 2013 . A copy of the Circular will be available today on the Company's website at www.tanfieldgroup.com\n \nIntroduction \n \nFollowing a consultation with its major shareholders in February 2013, the Board agreed to examine the potential disposal of the Snorkel Division, to reduce Tanfield's exposure to the Snorkel Division's on-going working capital requirements and thereby help to protect its investment in Smith Electric Vehicles. \n \nHaving appointed an M&A adviser, the Board examined a wide range of options and engaged w...