Croda sells German business

10th May 2010 08:33

Shares in Croda International were galvanised on Monday morning by news of the sale of the company's German oleochemicals business.The UK-based speciality chemicals supplier has agreed to sell its Emmerich site and associated German operations to a subsidiary of Kuala Lumpur Kepong Group (KLK) for €60.5m.KLK will assume the IAS19 retirement benefit obligations relating to the acquired business which will effectively reduce the cash amount Croda receives by €35.2m.The funds will be used to reduce Croda's net debt which stood at £292.7m at the end of March. The transaction is expected to be marginally earnings enhancing in fiscal 2010.Croda said the sale more or less brings to a close its restructuring programme for its oleochemical operations following the acquisition of Uniqema in 2006.On a pro-forma basis the disposed of business had sales of £80.0m and made an operating loss of £2.1m in 2009. It had net operating assets of £37.7m at 31 December 2009.