Divestment of Machine Tools
Renold plc is pleased to announce that, since its announcement on 23rd November 2006, it has agreed improved terms for the sale of certain assets and liabilities of the Group’s Machine Tools business to Venture Private Equity. The transaction was completed on Wednesday, 6th December 2006.
The divestment of the Machine Tools business is in line with the Board’s strategy to focus on its core Industrial Power Transmission operations and follows the disposal of the Automotive business which was announced in July this year.
Total cash proceeds of sale are £6.1M comprising of an initial consideration of £4.25M which was received on completion, a further £1.5M which is to be received in instalments commencing in February 2007 and ending in November 2007 and £0.35M from the net settlement of intra-group balances and cash balances transferred. Trade and contract bonds and guarantees of £1.7M are expected to be assumed or discharged by year end.
In addition, Renold has retained the right to a share of profits from any subsequent development of the Milnrow property.
As at 30th September 2006, the value of the gross assets of the Group’s Machine Tools business was £5.2M and for the financial year ended 31st March 2006, the operating loss of the Group’s Machine Tools business was £0.1M.