Sell-off boosts Inchcape
Tuesday 11 August 1998
The car distribution to marketing group said it had reached an outline agreement to sell its Russian bottling business to Coca-Cola for $187m (pounds 115m).
The chairman, Lord Marshall, also revealed that the group was in advanced talks to dispose of similar interests in South America.
Inchcape said in March it planned to float its South American business, but now it hopes to sell them to Embotelladora Arica, which is partly owned by Coca-Cola.
Inchcape shares rose19.5p to 195.5p as the City anticipated the two bottling deals could raise over pounds 565m and the company said it would return money to shareholders after April next year.
The chief executive, Philip Cushing, said there was good progress on the pending sale of its shipping services division. It would probably hive off its Asian and Middle East marketing business in two parts.
Inchcape unveiled in March a massive restructuring programme that would involve the sale of all businesses except car distribution.
Mr Cushing said he now hoped that this process would completed in the first or second quarter of 1999. For tax reasons a cash handout of proceeds from the disposals to shareholders would take place after April.
Analysts' fears that this could leave the rump dangerously exposed to the Asian downturn eased on yesterday's news. The company produced relatively healthy group financial figures. Interim headline pre-tax profits were down from pounds 78.8m to pounds 60m but operating profit within the core motor business was up by 16 per cent to pounds 61.7m.
There was a particularly strong performance from Greece, Australia and the UK where top performance cars like Ferraris were in hot demand.
The amount of profit produced in Asia was down by nearly a half to 26 per cent, Hong Kong being particularly badly hit. Mr Cushing said the area might have three or four difficult years but the long-term prospects for the region remained very good.
The deal with Coca-Cola in Russia is still subject to due diligence and regulatory approval. But the proposed price, free of debt, is healthily above net asset value of pounds 96m and the deal should go through by the end of the year.
Business has been difficult in Russia with a 37 per cent fall in volumes. In contrast, South America has been strong. Peru volumes were up by 82 per cent partly due to the introduction of new brands.
Inchcape said it was in advanced stages of discussions with Embotelladora Arica which is a Coca-Cola bottler with operations in Bolivia and Chile.
Investment, page 19
- 1 I'm A Celebrity 2014: Jungle security stepped up after murder and 'suspicious death' near to camp
- 2 To help fuel their propaganda machine against the poor, our government has now decided to redefine the word 'welfare'
- 3 Jeremy Hunt: 'I took my children to A&E because I didn't want to wait for GP appointment'
- 4 Girl, 7, gets Tesco to remove 'stupid' sign suggesting superheroes are 'for boys'
- 5 This letter from a reader explains why women can’t play football
Sarah Vine criticises lesbian mother Jack Monroe: 'If she was unsure about her sexuality, she should have taken greater precautions'
Black Friday 2014: Opening times for Asda, John Lewis, PC World, GAME and Argos
Three-year-old boy accidentally shoots dead his mother in Tulsa, Oklahoma, as she changes her younger daughter's nappy
Michael Brown shooting: Driver smashes into crowd as protests erupt across the US during a second night of unrest
Jeremy Hunt: 'I took my children to A&E because I didn't want to wait for GP appointment'
Rochester by-election: Ukip gains second MP as Tory defector Mark Reckless holds seat
'Beast of Bolsover' Dennis Skinner takes Ukip MP Mark Reckless to task moments after he is sworn in
Ukip says babies born to immigrants in the UK should be classed as migrants – which would include Nigel Farage’s own children
The young are the new poor: Sharp increase in number of under-25s living in poverty, while over-65s are better off than ever
Tamir Rice: 12-year-old boy playing with fake gun dies after being shot by Ohio police
Exclusive: UK approved £7m Israeli arms sales in six months before Gaza conflict
iJobs Money & Business
£16000 - £18000 per annum: Langley James : IT Support; Helpdesk, VMware; Manch...
£35000 - £450000 per annum + £3k car, £70k ote: h2 Recruit Ltd: Do you want to...
£Attractive Package: Citifocus Ltd: Prestigious financial institution seeks to...
£Negotiable: Citifocus Ltd: Experienced operational risk professional with ban...