Chemring Sells Marine Interests
Chemring Marine, the world’s leading supplier of marine pyrotechnic distress signals, has announced the sale of its marine interests to Drew Marine for £32 million.
Chemring sells marine interests
Chemring Group PLC has announced the sale of its marine interests to Drew Marine for £32 million.
Completion, which is conditional upon regulatory approvals and subject to a working capital adjustment, is expected by the end of July. The proceeds after costs will be used by the Group to reduce net debt, initiate a share buy-back and to fund existing pension liabilities of around £2 million.
Chemring Marine is the world’s leading supplier of marine pyrotechnic distress signals to the commercial and leisure marine markets, but is no longer considered to be core to Chemring and its wider international defence strategy. In the year ended 31 October 2011, the Company generated revenues of £21 million, an operating profit of £6 million, and had gross assets of £17 million.
Drew Marine is a recognised global leader in the supply of marine water treatment, maintenance, welding and refrigeration, fuel treatment and fire, safety and rescue products and services to ship owners, ship managers and shipyards. Drew Marine was acquired in 2009 by J.F. Lehman & Company, a leading middle-market private equity firm focused on the maritime, aerospace and defence sectors.
Dr. David Price, Chief Executive of Chemring, said: “I am pleased to announce the sale of Chemring Marine to Drew Marine. We have developed our maritime business into the clear world leader but its future in the commercial and leisure sectors is no longer aligned with the growth strategy for the Group.
Chemring believes that Chemring Marine will benefit from new owners who will provide the investment needed to expand its marine safety business and to develop its global maritime safety network.”
Len Gelosa, President and Chief Executive Officer of Drew Marine, said, “Chemring Marine’s global leadership position is synonymous with quality, performance and reliability – all attributes shared by the products and services offered by Drew Marine. We are excited about the prospects for the Pains Wessex, Comet and other well-known Chemring Marine brands as they join Drew Marine’s portfolio. In addition, we add a new distribution model to Drew Marine’s capabilities, which should allow us to broaden our customer base and explore additional products suitable for the Company’s global distributor network.”
Source: ADS Advance