Heywood shuts the door on US operation

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The Independent Online

Heywood Williams, a building materials group, yesterday announced that it would sell its US businesses, a move that could see the company return up to £160m to shareholders.

Heywood Williams, a building materials group, yesterday announced that it would sell its US businesses, a move that could see the company return up to £160m to shareholders.

The group will restructure to focus on its UK business, which manufactures PVC doors and windows. It will sell its US interests, which are a manufactured houses unit, a business which makes fittings for mobile homes, and a plastic pipes division. It has appointed Merrill Lynch to handle the disposal. Stephen Rawlinson, an analyst at Peel Hunt, said: "This probably signals the beginning of the end of Heywood Williams as a plc. But it's a tough time to sell a US manufactured housing business."

Analysts said the divestments could realise around £150m, and with some gearing up by the company, it could return up to £2 a share. Hamish Bryce, chairman of Heywood Williams, said a substantial proportion of the funds raised would be returned to shareholders. He added that part of the proceeds could be used to bolster, with acquisitions, the company's remaining UK doors and windows operations.

Industry sources said shareholders would want to see all disposal funds returned and that after the divestments, Heywood Williams was unlikely to have a future on the stock market as a small group.

There was speculation yesterday that the disposals would be followed by a management buyout. The company has had no chief executive since March and Mr Bryce, the acting chief executive, admitted yesterday that he was not looking to hire a permanent one. The company yesterday also reported results, for the six months to 30 June. This showed operating profits slipping in the UK, from £8.9m to £6.3m. The US saw operating profits improve, from £11.6m to £13.6m, on better margins. Analysts said they were puzzled as to why the best performing parts of the company were being sold off.

The company's shares closed 14p lower at 206.5p.

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