SIG PLC Disposal of VJ Technology (5674S)
26 June 2018 - 4:03PM
UK Regulatory
TIDMSHI
RNS Number : 5674S
SIG PLC
26 June 2018
26 June 2018
SIG plc
("SIG" or "the Group")
Disposal of VJ Technology
SIG plc, a leading European supplier of specialist building
products, announces that it has agreed to sell VJ Technology
("VJT") to Primary Capital, a UK private equity investment firm,
following a competitive disposal process. VJT is a UK distributor
of technical fixings, fasteners and consumables to the
infrastructure, commercial and wider construction industry, and
part of SIG Distribution.
The divestment is in line with SIG's medium term strategy of
disposing of smaller, non-core businesses in order to refocus the
Group's portfolio and strengthen its balance sheet. The strategy
review undertaken last year identified VJT's niche product offering
and operating model as being very different to that of the main SIG
businesses.
In the year ended 31 December 2017, VJT reported sales of
GBP31.0m, profit before tax of GBP5.0m and operating cash flow of
GBP4.1m. The gross assets of VJT as at 31 December 2017 were
GBP16.4m.
The consideration from the sale is expected to be c.GBP29.7m,
resulting in a gain on sale of c.GBP7.4m. The proceeds will reduce
net debt.
Completion is expected on or before 30 June 2018, reducing
leverage at the half year. The Group remains confident of meeting
its headline financial leverage target of 1.0 - 1.5x for the
current financial year and, as a result of this disposal and other
ongoing actions, is increasingly confident of its ability to
achieve its medium term target of headline financial leverage below
1x.
The profits of VJT were excluded from underlying operations for
planning purposes and therefore there is no impact on the Group's
expectations for current year underlying profit.
Enquiries
SIG plc
Meinie Oldersma, Chief Executive Officer +44 (0) 114 285 6300
Nick Maddock, Chief Financial Officer +44 (0) 114 285 6300
Clare Froggatt, Head of Communications +44 (0) 114 285 6300
FTI Consulting
Richard Mountain + 44 (0) 20 3727 1340
Jefferies Hoare Govett
Chris Dickinson / Paul Nicholls +44 (0) 20 7029 8000
Peel Hunt
Justin Jones / Charles Batten +44 (0) 20 7418 8900
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END
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