P&O disposal plan to raise pounds 2bn
Wednesday 24 March 1999
The radical programme will see the disappearance of over pounds 2.5bn of the transport group's pounds 5.9bn turnover, through the flotation of its Bovis construction arm, the P&O Nedlloyd containers joint venture, and the sale of its US and UK properties, including the Olympia exhibition centre in London's Earls Court.
News of the changes came after P&O reported a 14 per cent increase in underlying profits to pounds 415.9m and raised its dividend for the first time this decade.
Lord Sterling, the P&O chairman, said the disposals would bring P&O back to its seaborne heritage and that it could pave the way for a secondary listing in New York. "[Ferries,cruises and ports] will be the engine rooms of this company to drive it into the future," he said.
Lord Sterling said the proceeds of the sales would be used to pay debts and to boost investment in the P&O Stena Line cross channel ferry joint venture, and in the Princess and P&O cruise lines.
Shares in the group soared 5.5 per cent to 860.5p as City analysts welcomed the demise of P&O's conglomerate-like structure. Even though investors had been calling for disposals for some time, few expected such a radical programme. The bulk of the funds, around pounds 1.5bn, will come from the sale of P&O's retail and office properties in Britain and the US. The group said the portfolio could be sold in chunks or as a single company.
The flotation of Bovis Construction, set to be completed within a year, could raise up to pounds 350m, while the listing of the container venture could netpounds 300m. Olympia would probably be sold for about pounds 200m.
Meanwhile, Lord Sterling promised to bring back 50 ships to the UK flag - including the Grand Princess, the world's biggest cruise ship - if the Government introduced a tonnage tax. The levy, currently being considered by the Treasury, would result in lower rates for companies with large ships.
- 2 Why this father didn’t hide his daughter’s heroin overdose in her obituary
- 3 Smartphones are making children borderline autistic, says psychiatrist
- 4 Company breaks open Apple Watch to discover what it says is 'planned obsolescence'
Nepal earthquake in pictures: Photos show devastation caused by 7.8 magnitude earthquake
Nepal earthquake: More than 1,100 killed across four countries and in Mount Everest avalanche
Royal baby: Live updates as superbug closes ward at St Mary's Hospital where Duchess of Cambridge is due to give birth
Hermann Goering's daughter fails to reclaim items looted by Nazi deputy during WWII
Teaching profession headed for crisis as numbers continue to drop and working lives become 'unbearable'
The sickening truth about food banks that the Tories don't want you to know
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband
Migrant boat disaster: Ukip candidate mocks victims in sickening Twitter post
Nigel Farage wants the BBC to stop making programmes like Doctor Who, Strictly Come Dancing, and Top Gear
Global warming: Scientists say temperatures could rise by 6C by 2100 and call for action ahead of UN meeting in Paris
Rupert Murdoch berated Sun journalists for not doing enough to attack Ed Miliband and stop him winning the general election
iJobs Money & Business
£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...
£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...
£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...