ACER Acertec

    RNS Number : 4992C
  Acertec PLC
  02 September 2008
   

        
    2 September 2008

    Acertec sells UK steel reinforcement operations and interest in Irish joint venture to Celsa

    Acertec plc ("Acertec") today announces two disposals. It has sold the steel reinforcement operations of its subsidiary company BRC
Limited (the "Reinforcing Business") and agreed to sell its 50% interest in BRC McMahon Reinforcements Limited ("BRC McMahon") to Celsa
Steel Service (UK) Limited ("Celsa"), a subsidiary of Celsa (UK) Holdings Limited, a leading producer of steel reinforcement bars in the
United Kingdom and a manufacturer of other steel long-products.

    The aggregate consideration is �25 million. The consideration for the Reinforcing Business is �17 million (on a cash free debt free
basis, and subject to a post completion adjustment based on the net assets). The consideration for the interest in BRC McMahon will be �8
million. The proceeds of both transactions will be used to reduce the group's debt.

    The agreement to sell the Reinforcing Business is unconditional and will complete on 3 September 2008. The sale of the interest in BRC
McMahon is subject only to approval by the Irish Competition Authority. 

    The Reinforcing Business is the UK's largest manufacturer of engineered steel reinforcing bar and mesh products for the construction
market. Acertec operates in Ireland via its 50% interest in BRC McMahon. BRC McMahon manufactures and supplies a range of products for
forming, fixing, connecting and reinforcing concrete in the Republic of Ireland.

    For the year ended 31 December 2007, the Reinforcing Business generated �3.4 million of operating profit and, as at 31 December 2007,
had gross assets of �44.4 million. In its annual report and accounts for the year ended 31 December 2007, Acertec disclosed operating profit
of �1.8 million attributable to its interest in BRC McMahon and gross assets of �12.4 million.

    According to Celsa, the Reinforcing Business is a natural complement to Celsa's existing steel-making operations, and will continue to
provide customers and suppliers of the Reinforcing Business with a committed, service-oriented trading partner. Celsa has informed the
Acertec board that it values highly the employees of the Reinforcing Business who are transferring with the transaction.

    Following the two transactions, Acertec will continue to operate in two business units. Stadco is one of Europe's largest suppliers of
body-in-white pressings and sub-assemblies to automotive Original Equipment Manufacturers. BRC's Specialty Products business will be renamed
and along with Weldgrip will continue to focus on supplying speciality products used in construction and engineering projects. 

    David Hussey, Acertec Chief Executive, commented:

    "In our AGM trading statement on 20 May 2008, we commented on the impact of sharply rising raw material costs and difficult credit
conditions in the construction market in the UK.  These have particularly affected volume driven businesses such as the Reinforcing
Business. 

    Following an evaluation of the strategic options for these two businesses, we have concluded that a disposal represents the best
alternative for all stakeholders.  We are confident that we have achieved a fair price for each business and the proceeds received will help
reduce Acertec's indebtedness."

    - Ends -
    

    Enquiries:
 Acertec plc                              01789 403070
 David Hussey, Chief Executive
 Jonathan Cook, Group Finance Director 

 Hawkpoint Partners Limited              020 7665 4500
 David Renton

 Weber Shandwick Financial               020 7067 0700
 Nick Oborne / Rachel Martin 

 Celsa                                   029 2035 1830
 Chris Selby


This information is provided by RNS
The company news service from the London Stock Exchange
 
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