Babcock International Group PLC
2 October 2000
Contact: Dr John Parker, Chairman
Nigel Young, Group Finance Director
Babcock International Group PLC
Telephone: 01494 727296
Ginny Pulbrook
Citigate Dewe Rogerson
Telephone: 0207 282 2945
BABCOCK INTERNATIONAL GROUP PLC
Disposal of Babcock's rail maintenance interests to Adtranz
Babcock International Group PLC ('Babcock') announces that it has executed a
sale and purchase agreement to dispose of its majority held rail maintenance
business, Railcare Limited ('Railcare') (a UK based 60:40 jointly owned
venture with Siemens plc) to DaimlerChrysler Rail Systems (UK) Limited
('Adtranz'). Completion of the disposal is conditional upon the satisfactory
approval of the Office of Fair Trading. Babcock would receive at completion
cash consideration of some £5.7m.
In the year to 31st March 2000 Railcare incurred losses before taxation and
goodwill amortisation of £3.4m of which Babcock's share was £2.0m. At 31st
March 2000 Babcock's consolidated balance sheet included net assets of £17.2m
in respect of Railcare, of which Siemens' minority interest was £7.8m. The
exceptional loss which would arise for Babcock from the disposal is expected
to be some £4.0m.
Adtranz's principal activity in the UK is the design, manufacture,
maintenance, repair and refurbishment of railway rolling stock and rolling
stock equipment.
The proceeds from this disposal will be focussed upon expanding and developing
Babcock into a strong specialist service provider within growth markets.
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