Wassall to hand back pounds 150m

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The Independent Online
Wassall shares jumped 22p to 376p yesterday after the bottle tops to luggage conglomerate announced plans to repay pounds 150m to shareholders alongside the demerger of its US copper wire business, General Cable.

Investors will receive around 76p a share from the special payment, which has been structured by SBC Warburg, the merchant bank, as a capital consolidation along the same lines as similar deals for Yorkshire Water and Southern Electricity.

Chris Miller, Wassall chief executive, hailed the move as blazing a new trail for conglomerates. "We can't set out to copy a Hanson or a BTR, or even a Williams or a Tomkins," he said. Wassall wanted to set out a different strategic vision for conglomerates.

However, Mr Miller said the group did not want to be put in a "straitjacket" of having to do similar deals every three years or with every acquisition. "But we will where we can create value for shareholders."

The payout will be made from the proceeds of the expected $750m US flotation of up to 70 per cent of General Cable in May. Mr Miller said the expected $590m net proceeds of the initial public offering would leave the group with around pounds 190m, even after handing back pounds 150m to shareholders.

Yesterday's news came as Wassall unveiled a dip in pre-tax profits from pounds 57.5m to pounds 53.1m for the year to December. Stripping out copper losses and exceptional items, profits rose 30 per cent to pounds 65.9m. Dividends for 1996 rise 29 per cent to 7.1p, after a final of 5p.