Business
Disposal of Brock Metal
Disposal of Brock Metal.
About this update from Alumasc Group Plc
[{"type":"text","content":"\n Alumasc Group PLC\n08 June 2007\n\n\nFriday 8 June 2007\n\n THE ALUMASC GROUP PLC\n\n Alumasc contracts to sell Brock Metal\n\nThe Alumasc Group plc (ALU.L), the premium building and engineering products\ngroup, announces that agreement has been reached to sell the Brock Metal\nbusiness, the leading UK supplier of zinc and aluminium die-casting alloys, to\nChelyabinsk Zinc Plant (\"CZP\") for cash consideration of £8.15 million, subject\nto completion accounts adjustment. The consideration is equal to the net book\nvalue of the assets being transferred. Alumasc will retain ownership of Brock's\nfreehold factory near Cannock, which has an estimated value of £1.5 million and\nwill be leased to CZP. All of Brock's existing management team and employees\nwill transfer with the business.\n\nThe sale of Brock, which is expected to complete at the end of June 2007, is\nstrategically important for Alumasc, enabling increased management focus on\ngrowing the group's higher margin core premium building and precision\nengineering products businesses. The proceeds of the transaction will be used to\nreduce group borrowings which had increased following the £13.5 million\nacquisition of Levolux in May. The transaction will also release about\none-quarter of Alumasc's existing working capital requirements and significantly\nreduce volatility within the monthly working capital cycle, allowing the group's\nfinancial resources to be more effectively deployed.\n\nCZP raised $368 million last year in an initial public offering of more than 30%\nof the company's capital on the Moscow and London stock markets and is the\nleading producer of SHG zinc and zinc alloys in Russia. CZP confirmed in a press\nrelease today that the jobs of all Brock employees remain secure.\n\nIn the year to 30 June 2006, Brock's operating profit was £0.7 million on\nrevenue of almost £40 million. Brock's gross assets at 31 December 2006 were\n£12.7 million. Brock's revenue, profitability and working capital requirements\nhave all increased significantly in the current year driven by a period of\nexceptionally high worldwide zinc prices.\n\nCommenting on the transaction, Paul Hooper, Chief Executive of Alumasc, said:\n\n\"The sale of Brock Metal announced today and the acquisition in May of Levolux,\nthe UK's leading provider of solar shading and control systems us...