Babcock International Group PLC
2 January 2002
2 JANUARY 2002
BABCOCK INTERNATIONAL GROUP PLC
BABCOCK SELLS CEMENT HANDLING BUSINESS
Babcock International Group PLC (Babcock) today announces a further
development in its repositioning as a support services group with the sale of
its cement handling business, together with its holding company BMH
Technologies, to the UK based Langley Holdings plc.
Babcock will receive £500,000 for the sale over the next twelve months.
Immediately prior to completion BMHT has repaid £4.6m of intercompany debt.
The businesses being sold had a turnover in the half year to 30 September 2001
of £23.0m (in the financial year ending 31 March 2001 of £57.6m) and made a
loss of £0.5m in the half year to 30th September 2001 (a profit in the
financial year to 31 March 2001 of £2.0m). At completion the businesses being
sold will have net assets of approximately £3.4m including cash of £8.2m to
meet advance payments from customers and pension liabilities. In addition
related goodwill of £2.0m will be written off.
Babcock also confirms that it is in negotiations to sell its AKI business,
which manufactures plasterboard drying equipment. The board is reviewing the
carrying value of all of its materials handling businesses and it is
anticipated that this will result in the goodwill attributed to these
businesses of £13.5m (including that relating to the AKI business) being
written off in this years accounts.
The sale of the cement business, which was a key element of the BMH division,
and the anticipated sale of the plasterboard drier business, will enable
Babcock to phase out the BMH divisional structure, thereby further
rationalising the portfolio. This is expected to be completed by March 2002.
Commenting on the transaction, the Babcock Chairman, Gordon Campbell said:
'This is a major step forward in implementing the Babcock strategy to which we
are committed. It will now allow us to focus on our key markets in support
services and facilities management.'
Notes to editors:
About Babcock International Group PLC
Babcock International Group PLC is a support services business with focussed
activities in defence training and international engineering. Sales in the six
months to 30 September 2001 were £227 million.
The Group operates from three principal divisions: BES (engineering and
support services in defence, rail, marine and secure facilities sectors), HDS
(support services and facilities management for the defence sector) and BMH
(material processing technologies and engineered systems). The Group is
currently in the process of disposing of the BMH division as part of Babcock's
strategy to focus on the support services market and, in the process, enhance
shareholder value.
Babcock's head office is in London and the Company's shares are quoted on the
London Stock Exchange. For further information, please visit Babcock's website
at www.babcock.co.uk.
About Langley Holdings plc
Langley is the diverse family controlled engineering group that acquired the
Rolls Royce materials handling division in December 2000.
Langley now employs c.1200 people worldwide and sales for 2001 are expected to
be c. £125 million.
Contact:
Gordon Campbell, Executive Chairman
Bill Tame, Group Finance Director
Babcock International Group PLC
020 7291 5000
Rupert Steveney
Citigate Dewe Rogerson
020 7282 2843
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