Hanson sells Eveready South Africa

Click to follow
The Independent Online
Hanson has sold its Eveready South Africa battery operation to Duracell International, the world's biggest maker of alkaline batteries, for 525m rand (pounds 82m). The sale announced yesterday comes on top of $2.9bn (pounds 1.9bn) of disposals already completed by the industrial conglomerate in advance of the four-way demerger planned for later this year.

It completes the tidying-up of the Ever Ready batteries business, the UK end of which was sold to Ralston Purina of the US in 1992. At the time, Ralston was restricted in what it could invest in South Africa by US sanctions. Hanson would not comment on whether the US group was involved in the bidding for Eveready South Africa, but it is known that an auction took place.

Hanson acquired Ever Ready for pounds 95m in 1981, netted pounds 40m from immediate disposal of loss-makers, and retains the Crabtree electrical plugs and sockets business.

Derek Bonham, chief executive, said: "This sale marks further progress in our disposals in advance of our demerger programme, which is on track for later this year." Vice-chairman Christopher Collins said the plan was for the chemicals and tobacco operations to be demerged by 30 September, with energy going by the end of the year. A roadshow to investors will kick off in September.

Eveready South Africa had sales of 365m rand in the year to last September, but Hanson would not release any details of profits or net assets. However, the unit has reported lower profits in each of the past two fiscal years, hindered by open-market competition as South Africa reduces tariff barriers.

The acquisition represents a quantum leap for Duracell, which only set up a business in South Africa two years ago. The large zinc carbon batteries produced by Eveready South Africa are old-fashioned by Western standards, but represent an extremely profitable business in southern Africa.

The operation has a factory in Port Elizabeth and employs 900 people. It controls 95 percent of the zinc carbon round cell battery market in South Africa.