BTR to spin off Hawker Siddeley in Canada: Toronto flotation valued at pounds 65m part of stratgey to concentrate on core manufacturing

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The Independent Online
BTR, the industrial conglomerate, plans to spin off its Hawker Siddeley operation in Canada as part of its strategy to concentrate on core manufacturing businesses.

The flotation on the Toronto Stock Exchange of BTR's 59 per cent holding in Hawker Siddeley Canada will value the operation at about pounds 65m.

BTR acquired the stake in 1991 when it paid pounds 1.55m for Hawker Siddeley, the UK aerospace and engineering group, and the sale is expected to be completed by the end of April at the latest.

More than half of the Canadian operation's activities are in servicing, lease finance and mining contracting.

These include the repair and overhaul of jet engines and railcars in the US and UK. Alan Jackson, chief executive, said the operation did not readily fit with BTR's stated intention of concentrating nufacturing operations.

Last year BTR announced plans for a stock market listing of Graham Group, Britain's fourth-largest builders' merchants, through a public offer and placing.

Analysts said BTR was taking advantage of the upbeat equity market to sell off non-core interests. 'It is all part of a tidying-up operation,' said one. 'BTR prefers to have 100 per cent control and clearly thought it best to take advantage of current market conditions rather than buy the remaining 41 per cent.'

In the nine months to 30 September, Hawker Siddeley Canada reported net earnings of Cdollars 11m (pounds 5.7m) on sales of Cdollars 279.4m.

Mr Jackson, who declared a strategy of divestment when he became chief executive in 1991, said: 'The proposed offering will allow Hawker Siddeley Canada to become a widely-held public company with a common share float of approximately 8.2 million shares.

'Hawker Siddeley Canada has a strong balance sheet, with shareholders' equity of about dollars 240m and no indebtedness for borrowed money other than non-recourse debt for its railcar leasing operations.'

When he took over as chief executive of BTR in 1991, Mr Jackson said he would concentrate resources on industrial manufacturing.

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