The sale will cost Finning International C$33m in losses against the division’s book value. Mike Waites, Finning International CFO, said the company is looking to buy back debt paper worth up to £50m, due in 2013. The company explained that the sale price is close to the book value of assets for the division – the losses are associated with the value of goodwill and intangibles, and will be reported as an after tax loss in the third quarter.
Doug Whitehead, President and CEO of Finning International, said “Following an extensive strategic review of our United Kingdom based businesses, we determined that the Materials Handling division no longer represents a core business for Finning. The sale of this division will allow us to focus our financial and management resources on those UK businesses that are more closely associated with our Caterpillar equipment related core strengths. These include Finning (UK)’s Caterpillar dealership for England, Scotland and Wales, as well as Hewden, the largest provider of rental solutions for the UK construction industry, and Diperk UK, the distributor of Perkins engines and parts in the United Kingdom”
The sale comes as Hewden’s UK operation works on the reorganisation of its cranes business. As Cranes Today reported in July 2006, it will rent out cranes from its network of more than 300 construction equipment rental depots. As part of the reorganisation, it is reducing the number of crane depots and making up to 60 people redundant, and focusing on the sub-100t market.