Building fixtures and fittings supplier GWA International Ltd
(ASX:GWT) has entered into a binding agreement to sell its European sanitary ware business, Wisa Beheer, for $17 million.
The deal is with a private group led by the company’s local management and is to be completed this week with the sale proceeds being received immediately as final settlement.
Managing director Peter Crowley says the Netherlands-based Wisa business was acquired in 1999 as a strategic entry into Europe but GWA has since developed its global sourcing capabilities and is not looking to grow through a European manufacturing base.
Mr Crowley says Wisa is no longer a core business and is more suited to local ownership.
Following the sale, the results for Wisa Beheer will be shown as a discontinued operation in GWA’s financial report for the year ending June 30, 2010.
A loss of about $3.5 million after tax will be recorded for the year to reflect trading results to February 2010, asset write-downs and currency translation losses as a result of the sale.
Mr Crowley says the sale is consistent with the company’s strategy to divest non core businesses and use the sale proceeds to focus on its core building fixtures and fittings businesses.
GWA International posted a profit of $48.32 million for the 2009 financial year.
