Information  X 
Enter a valid email address

Alumasc Group Plc (ALU)

  Print          Annual reports

Friday 08 June, 2007

Alumasc Group Plc

Disposal of Brock Metal

Alumasc Group PLC
08 June 2007


Friday 8 June 2007

                             THE ALUMASC GROUP PLC

                     Alumasc contracts to sell Brock Metal

The Alumasc Group plc (ALU.L), the premium building and engineering products
group, announces that agreement has been reached to sell the Brock Metal
business, the leading UK supplier of zinc and aluminium die-casting alloys, to
Chelyabinsk Zinc Plant ("CZP") for cash consideration of £8.15 million, subject
to completion accounts adjustment. The consideration is equal to the net book
value of the assets being transferred. Alumasc will retain ownership of Brock's
freehold factory near Cannock, which has an estimated value of £1.5 million and
will be leased to CZP. All of Brock's existing management team and employees
will transfer with the business.

The sale of Brock, which is expected to complete at the end of June 2007, is
strategically important for Alumasc, enabling increased management focus on
growing the group's higher margin core premium building and precision
engineering products businesses. The proceeds of the transaction will be used to
reduce group borrowings which had increased following the £13.5 million
acquisition of Levolux in May. The transaction will also release about
one-quarter of Alumasc's existing working capital requirements and significantly
reduce volatility within the monthly working capital cycle, allowing the group's
financial resources to be more effectively deployed.

CZP raised $368 million last year in an initial public offering of more than 30%
of the company's capital on the Moscow and London stock markets and is the
leading producer of SHG zinc and zinc alloys in Russia. CZP confirmed in a press
release today that the jobs of all Brock employees remain secure.

In the year to 30 June 2006, Brock's operating profit was £0.7 million on
revenue of almost £40 million. Brock's gross assets at 31 December 2006 were
£12.7 million. Brock's revenue, profitability and working capital requirements
have all increased significantly in the current year driven by a period of
exceptionally high worldwide zinc prices.

Commenting on the transaction, Paul Hooper, Chief Executive of Alumasc, said:

"The sale of Brock Metal announced today and the acquisition in May of Levolux,
the UK's leading provider of solar shading and control systems used in
commercial and public buildings, each represent significant strategic
developments for Alumasc. They demonstrate the group's focus on further growing
the profitability of its core niche premium building and precision engineering
products businesses.

I believe Brock, under CZP's ownership, should benefit from becoming part of an
international metals business and I would like to take this opportunity to
express my gratitude to all the Brock employees for their contribution to
Alumasc and to wish them every success in the future."


Enquiries:

The Alumasc Group Plc                                             01536 383 844
Paul Hooper

Bankside Consultants Ltd.
Charles Ponsonby                                                  020-7367 8851




                      This information is provided by RNS
            The company news service from the London Stock Exchange

a d v e r t i s e m e n t