Pilkington to float off Australasian holdings

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The Independent Online
PILKINGTON, the glass maker, confirmed yesterday that it plans to float up to half its Australasian interests as part of a programme to reduce its pounds 800m debts.

Sir Antony Pilkington, chairman, said the move also reflected a desire to return to the 50 per cent ownership of the interests that the group had before 1988. The company denied it had chosen a stock market flotation because it could not find a trade buyer.

Pilkington does not strip out the profits from the Australasian float glass, windscreen and toughening operations in its accounts, but analysts believe they contribute operating profits of about pounds 12m a year.

The flotation, probably in June, is expected to raise up to pounds 70m, which would reduce gearing from 68 per cent to 63 per cent. The company plans to reduce its debts to 50 per cent of shareholders' funds by the end of 1995.

Andrew Robb, finance director, said disposals of other non-core operations would complete a pounds 200m debt-reduction programme. It is thought that the company's optronics, insulation and defence businesses could be up for sale.

Pilkington's debts remain high despite the sale last September of its Sola spectacles business for pounds 210m. Sola had consistently performed well and at the time the company was accused of selling the family silver.

Group profits have slumped from a peak of pounds 300m in 1990 to pounds 40.7m last year and it has twice cut its dividends. The sharp decline is due partly to the recession but also to excess capacity in the industry. The shares closed 0.5p lower at 194.5p.