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Melrose Industries to sell Nortek Air Management for £2.62bn
StockMarketWire.com
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Engineering company Melrose Industries said it had agreed to sell its Nortek Air Management business to Chicago-based Madison Industries for around £2.62 billion ($3.625 billion).
Melrose Industries said a portion of the proceeds would be returned to shareholders, without specifying how much.
It also intended to use the proceeds to cut debt and contribute around £100 million to GKN's defined benefit pension schemes.
Completion of the deal, which was struck at a multiple of 12.5 times 2020 adjusted earnings, was expected in the second or third quarter of 2021 and was conditional on shareholder approval.
'The disposal demonstrates the strength of the Melrose strategy,' chairman Justin Dowley said.
'We bought Nortek, an underperforming group, which we felt had outstanding potential in 2016 for £2.2 billion ($2.8 billion).'
'We have seen approximately $1 billion of cash inflows from the Nortek group during our ownership, effectively giving us an in-price of $1.8 billion.'
'Our Ergotron and Nortek Control businesses, which also form part of the Nortek group, remain under our ownership and will be realised at an appropriate time.'
Story provided by StockMarketWire.com
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