Croda International PLC
31 October 2000
Sale of Adhesives Business and Trading Update
Sales of Adhesives Business
Croda International Plc announces the sale of its worldwide Adhesives business
to Sovereign Specialty Chemicals Inc. of Chicago, USA.
The consideration for this transaction will be approximately £44.5m of which
£41.4m has been paid in cash on completion and a further payment, dependent on
the performance of Croda's Brazilian adhesives business this year, will be
made early in 2001.
Croda Adhesives is one of the worlds leading manufacturers of speciality
adhesives and has operations in the UK, USA, Brazil, Belgium, Italy, Sweden
The business had net assets of £17.9m at 31 December 1999 and made a trading
profit of £2.7m in 1999.
The proceeds of the disposal will initially be applied in reducing the Group's
borrowings. In the medium term, they will enable the Group to expand its
activities in its core business.
Commenting on the transaction Mike Humphrey, Chief Executive, said,
'This disposal is a landmark in our strategy of focusing our business on high
added value oleochemicals'.
Third Quarter Trading
In common with many other industrial companies, trading in the third quarter
was slower than the same quarter last year. Our unaudited management accounts
for the quarter show sales in continuing businesses up 2% and while
Oleochemical profits were steady, Industrial Chemicals' profits in the third
quarter were well down on those of last year.
Demand continued to be good in Europe, the Americas and the Far East but sales
in the UK took another step backwards influenced by the strength of the Pound
against the Euro. While the outlook for the final quarter is a little
brighter, Group profit before tax and exceptional items for the nine months to
30 September 2000 is 6% down on last year.
For further information contact:
B M Richmond Croda International Plc 07767 252 627
Mike Humphrey Croda International Plc 07785 307786
Tom Baldock Financial Dynamics 020 7831 3113