Aug 19 2005
Heywood Williams Group PLC has announced that it has agreed to sell its Plastic Systems Division (HW Plastics) to Latium Plastics Holdings Limited (Latium) for a cash consideration of £3 million. In addition, Latium will assume certain product rectification liabilities and obligations as part of the purchase of HW Plastics. As a result, the prior provisions for future cash outflows of approximately £17.0 million associated with potential product rectification claims are now no longer required.
The financial impact of the disposal is expected to be significantly earnings enhancing for the Group going forward.
The disposal is conditional only on the approval of Heywood Williams’ shareholders. The notice convening an Extraordinary General Meeting of the Company recommending approval of the disposal will be dispatched to shareholders shortly.
On 1 July 2005, the Board of Heywood Williams announced its decision to grow the Group by initially focusing on the design, development, marketing and distribution of branded building products. This followed the completion of an in-depth strategic review of HW Plastics, which concluded that this division is non-core to the future development of the Heywood Williams Group. The Board therefore initiated a process which has culminated in this disposal.
The disposal advances the Group’s strategy of creating a focused, branded building products distribution group. Heywood Williams has strong market leading positions in the North American manufactured housing, recreational vehicle and modular housing markets and in the supply of hardware and door panels to the UK and certain other European window, door and conservatory fabrication markets.
The future focus of the Group will be to continue the growth of LaSalle Bristol in North America and the Hardware Division in the UK and Europe, while seeking further growth opportunities.
The current market conditions in North America, the UK and Europe remain as previously outlined. Overall, the Group continues to trade in line with its full year plans.
HW Plastics, which is the UK market leader in PVC windows systems and cellular buildings products, operates two manufacturing plants located in Macclesfield and Scunthorpe and a distribution centre located in Trentham. It has approximately 600 employees.
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