The Smiths Group has sold its Polymer Sealing Solutions (PSS) business to Trelleborg of Sweden for £495 million.
PSS operates within four market segments: industrial applications (Busak+Shamban), the automotive industry (Dowty Auto), the aerospace industry (Shamban) and pipe seals (Forsheda).
Commenting on the sale Smiths Group chief executive Keith Butler-Wheelhouse said: ‘The disposal emphasises Smiths’ strategy of concentration on core businesses in detection, medical and aerospace markets. The proceeds will be used to reduce net debt, but we aim to continue to match buys with sells. This transaction brings the proceeds of disposals since July 2002 to £650 million with acquisitions of over £230 million.’
PSS recorded sales in 2002 of £378 million with an operating profit of £45 million. The business employs 6000 people and supplies polymer products to the industrial, automotive and aerospace markets. Polymer’s net assets are £340 million including £190 million of capitalised goodwill. After goodwill previously written off to reserves, the accounting loss on sale will be approximately £130 million.
Subject to EU and US regulatory approval, Smiths will identify the results of these discontinued activities separately in its 2003 Accounts. The 2003 earnings per share attributable to the discontinued activities, after allocation of interest, is likely to be 4½ pence.