BTR sells plastics business for $300m

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BTR, the industrial conglomerate, has concluded a $300m (pounds 191m) deal for the sale of its 51 per cent stake in Taiwan Polymer, its poorly performing Far Eastern plastics business.

The disposal comes hot on the heels of last week's sale of the Tilcon quarrying and aggregates operations in the US for $329m and brings to $900m the amount raised by the disposals programme instituted by chief executive Ian Strachan, who has undertaken an overhaul of the sprawling conglomerate since taking over in January.

News of the latest sale sent BTR's shares 3.5p higher to 265.5p, although the deal will not affect the half-year figures due on Thursday, when BTR is expected to cut its dividend.

Analysts generally welcomed the deal, which they said met expectations in terms of price, even if the timing was a little disappointing. The British group will receive $120m on completion, with further payments of $90m in each of the two succeeding years. Mark Cusack at UBS described the sale as "another chink of light". In itself this was not a massive deal, he said, but added: "There is overwhelming relief in the stock market that they are out and it is another underperforming business which has gone - and very cyclical, too."

Taiwan Polymer makes and sells bulk petrochemicals in Taiwan and the US. Its styrene product is a constituent part of polystyrene. The business has been affected by poor demand and weak pricing, causing a drag on profits from the Far East.

Net assets involved in the sale amount to around $385m, with a further $35m being provided for contingent contractual liabilities. BTR will therefore take a $35m loss on disposal. The purchaser is a consortium of USI Far East Corporation and Union Petrochemical Corporation.