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Low & Bonar PLC - Proposed disposal of Bonar Plastics
Low & Bonar today announces the proposed disposal of Bonar Plastics (the “Disposal”) and the terms of a proposed reduction of share capital and cancellation of share premium account (the “Capital Reorganisation”).
HIGHLIGHTS
| Proposed disposal of Bonar Plastics to Promens hf., a subsidiary of Atorka Group hf. (“Atorka”), for a consideration of £25.75 million in cash before transaction costs, subject to adjustments on completion. | ||
| For the year ended 30 November 2004, Bonar Plastics generated profit before interest and tax of £1.2 million on turnover of £59.2 million. | ||
| The proposed Disposal will result in an enhanced strategic focus and will enable the Low & Bonar Group to finance strategically appropriate acquisitions in the Floors and Yarns & Fabrics divisions. | ||
| Completion of the Disposal is subject to approval by shareholders at an extraordinary general meeting, which is expected to be held towards the end of August. | ||
The Board has decided to seek shareholder approval for the cancellation of Low & Bonar's share premium account and a reduction in the nominal value of its authorised and issued ordinary share capital in order to seek to maintain Low & Bonar's current dividend policy. |
Commenting on the Disposal, Paul Forman, Group Chief Executive of Low & Bonar said:
"The disposal of Bonar Plastics will allow us to focus on the higher margin Floors and Yarns & Fabrics divisions, both of which have seen good organic growth. The acquisition of Xirion announced last week is an important strategic step for the Yarns & Fabrics division and the other two recent acquisitions in this division are performing satisfactorily. The cash realised by the disposal announced today will enable us to pursue further acquisitions as we continue to develop the business."
Commenting on the Disposal, Magnús Jónsson, Executive Chairman of Atorka, said:
“We are pleased to welcome Bonar Plastics into the Atorka Group and we look forward to working with the Bonar Plastics management and employees. I am confident that the business will continue to progress under our ownership.”
Contacts:
| Low & Bonar PLC | +44 (0) 20 7298 6820 |
| Paul Forman, Group Chief Executive | |
| Jon Kempster, Group Finance Director | |
| PricewaterhouseCoopers LLP | |
| David Armfield, Partner | +44 (0) 121 232 2566 |
| Darren Bryant, Director | +44 (0) 20 7804 4089 |
| Tulchan Communications | |
| David Trenchard | +44 (0) 20 7353 4000 |
This announcement summarises the information contained in the circular to shareholders which will be posted as soon as practicable.
PricewaterhouseCoopers LLP, which is authorised and regulated in the United Kingdom by the Financial Services Authority for designated investment business is acting exclusively for Low & Bonar PLC and for no one else in relation to the Disposal and will not be responsible to anyone other than Low & Bonar PLC for providing the protections afforded to clients of PricewaterhouseCoopers LLP or for giving advice in relation to the Disposal, or any other matter referred to in this announcement.
Notes to editors
Low & Bonar is an international group manufacturing and supplying a wide range of products in the Specialist Materials and Plastics markets. Bonar Plastics is predominantly a rotational moulder of plastics, providing solutions to customers in the chemicals, automotive, environmental, point of sale and food processing markets.