Disposal
Centrica PLC
04 November 2002
4 November 2002
Centrica and DCC reach agreement on sale of LPG business
Centrica plc and DCC plc today announced that DCC, the business support services
group, has reached agreement to acquire, subject to completion, Centrica's
liquefied petroleum gas (LPG) business, British Gas LPG, for a consideration of
£41.1 million (approximately €64.5 million) in cash.
The sale of the business comes after a strategic decision by Centrica to focus
on direct customer relationships in its core businesses, whereas a large portion
of the LPG cylinder business operates through third party retailers.
DCC is already one of the leading companies in the LPG market in Britain and
Ireland, operating under the Flogas and Alta Gas brands. The acquisition of
British Gas LPG will double DCC's share of the British market to 21%, making it
the second biggest LPG company in Britain.
In the year ended 31 December 2001, British Gas LPG generated operating
profits of £2.3 million on turnover of £54.1 million. For the eight months to 31
August 2002, unaudited operating profits were £2.9 million. The business had net
assets at 31 August 2002 of approximately £40 million net of debt of £2.1
million.
The assets being transferred consist mainly of bulk tanks at customers'
premises, cylinders, road tankers, 23 depots, an operations centre in North
Wales and a commercial centre at Witney, Oxford. Consultations with British Gas
LPG employees and trade unions are now taking place. It is anticipated that the
transaction will be completed by the end of November 2002.
Jim Flavin, Chief Executive and Deputy Chairman of DCC, said: 'The acquisition
of British Gas LPG continues the strong growth momentum in DCC's substantial
energy operations. This acquisition, along with the Alta Gas acquisition last
year, will significantly strengthen DCC's position in the LPG market in Britain
and is expected to lead to a substantial increase in the profit contribution to
DCC Energy from this market.'
Mark Clare, Managing Director of British Gas, said: 'This transaction is in line
with Centrica's strategy of concentrating on building deeper customer
relationships and our commitment to continue delivering shareholder value by
focusing on our core businesses. We are delighted to have reached this agreement
with DCC, who we believe are in an excellent position to continue to provide the
highest standards of service to this customer group.'
Enquiries:
Centrica plc DCC plc
Centrica Investor Relations Jim Flavin, Chief Executive / Deputy Chairman, DCC plc
01753 494900
Centrica Media Relations Kevin Murray, Managing Director - DCC Energy
01753 494085
Conor Costigan, Investor Relations Manager
Tel. + 353 1 279 9400
Email: investorrelations@dcc.ie
For further information on DCC: www.dcc.ie
Editor's notes:
About Centrica - Since it was formed in 1997, Centrica has developed into a
leading provider of energy and other essential home services. In the UK,
Centrica offers gas and electricity supply and related products under the
British Gas brand, roadside and financial services from the AA, telecoms
products and services through One.Tel and British Gas, and financial services
through Goldfish. The group's strategy of international expansion has seen it
make acquisitions in Canada and the United States.
About DCC - DCC is a business support services group focused on sales, marketing
and distribution in the energy, IT, healthcare and food markets, operating
principally in Britain and Ireland. In its latest financial year to 31 March
2002, DCC had sales of €2.049 billion and generated operating profits of €102.7
million. DCC's shares are traded on the Irish and London Stock Exchanges.
DCC's energy operations have a track record of strong profit growth and
excellent returns on capital employed and cash generation and in the year to 31
March 2002 generated operating profits of €35.0 million on turnover of €717.6
million. Through strong organic growth and value enhancing bolt-on acquisitions,
DCC has become a substantial marketer and distributor of LPG and oil products in
Britain and Ireland.
For further information please visit www.dcc.ie.
This information is provided by RNS
The company news service from the London Stock Exchange
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