Australian buy boosts McKechnie

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The Independent Online
SHARES in McKechnie, the plastics and metal components company, jumped 13p to 464p on news of an Australian acquisition and a South African disposal. Some 500,000 shares changed hands, writes Alison Eadie.

The company, which views the Pacific rim as a growth area, is paying Adollars 12.5m ( pounds 6m) for Regency Group, a leader in the Australian shower-screen and wardrobe market and manufacturer of security doors, balustrading and pool fencing. Regency has annual sales of Adollars 42m, assets of Adollars 4m and pre-tax profits of about Adollars 3.5m.

McKechnie's chief executive, Michael Ost, said: 'The extensive use of aluminium extrusions and security mesh by Regency will provide considerable synergistic benefits to the New Plymouth-based McKechnie Metals and to the recently acquired Phipps International security business.'

The company has also disposed of its last interest in South Africa to Delta Group. The pounds 11m sale of its 18.8 per cent stake in Cobra, the industrial services company, provides funds for developing other businesses, Mr Ost said. Cobra made a pre-tax contribution of pounds 2.7m to McKechnie last year.

Delta owns 37.6 per cent of Cobra. Tomkins, the UK conglomerate, also owns 37.6 per cent and German company Grohe the balance.

McKechnie's offer document for Linread in the agreed pounds 27m bid said the combined group would create a stronger international competitor in fastener technology.

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