Delta plc Announces the Disposal of Sourdillon
Following the announcement of 23 April 2002 regarding the exchange of contracts between Delta and Burner Systems International for the sale of Sourdillon the gas burner manufacturer, this transaction has now been completed.
April 23, 2002
Disposal of Further Plumbing Business Delta plc announces that it has exchanged contracts for the sale of Sourdillon, a manufacturer of gas burners based in France, United States and Mexico.
On completion of the sale, Delta will receive gross proceeds of £18.2 million from Burner Systems International which represents a premium to asset value as at December 2001 of around £1 million.
The proceeds will be reduced by approximately £2.1 million with the purchase by Delta of the minority in Sourdillon's Mexican operation which will be acquired before completion of the transaction. In addition a sum of £2.8 million will be retained by the purchaser from the gross consideration for environmental remediation at Sourdillon's facilities in France and Mexico.
In the year to December 2001, Sourdillon made profits of £1.8 million on sales of £32.9 million.
The proceeds from this sale will be used to reduce Group borrowings and to fund ongoing investment in Delta's main businesses. Completion of this transaction is expected by the end of June 2002.
Commenting on today's announcement, Delta's Chief Executive Jon Scott-Maxwell said: "Sourdillon is the largest of the remaining Plumbing businesses. Despite the deterioration in the climate for asset disposals since our announcement regarding Plumbing divestment in November 2000, this deal will achieve the disposal of most of these businesses."