Elders sells Futuris for $69m
Elders Limited has reached an agreement to sell its Futuris Automotive business to affiliates of US investment firm, Clearlake Capital Group.
In a statement to the stock exchange this morning, Elders said the price represented an enterprise value of A$69 million.
The sale, which is subject to Foreign Investment Review Board approval, is expected to be completed by the end of August.
Elders said the proceeds from the sale would be used to reduce Elders’ net debt by approximately A$56 million.
“Subject to finalisation of disposal accounting, a one off net loss of approximately A$28 million against book value will be crystallised on sale,” the company said.
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“For Elders, the transaction represents a major step in becoming a pure play rural services business, with the run-off of the only other significant non-core business, Forestry, on track for completion before the end of the year.”
Elders Managing Director Malcolm Jackman said the Futuris sale was a good outcome for Elders “both in terms of our priority to focus capital on a ‘pure play’ rural services business and the ability to further reduce our debt”.
“It is also a very positive result for Futuris, its employees, customers and the Australian automotive industry as it represents a vote of confidence in both Futuris and the Australian industry,” Jackman said.
“Futuris is a strong business with globally recognised innovation, design and manufacturing capabilities. Under Clearlake’s ownership, Futuris will have access to fresh capital to pursue growth opportunities around the world.”
Futuris manufactures automotive interior components and has 1900 global employees, including 800 in Australia.
