Britain’s Melrose Industries laid out plans to return about 730 million pounds in cash to its shareholders after the company sold its Nortek Air Management business in April.
Melrose specializes in acquiring and turning around underperforming businesses before selling them on. They had agreed in April to sell Nortek. Their plan was to use proceeds to pay down debt, reduce a UK pension deficit and return cash. The proposed return of capital and share consolidation, through which the returns will be executed. And this would require approval from shareholders. CEO Simon Peckham said that they have taken a conservative view for the level of the current return of capital. But if markets continue to recover, they expect to announce a further significant return next year.
The owner of GKN, which is suppling parts to carmakers, said that there were some encouraging signs for its aerospace division after the big hit of this pandemic. This division had squeezed out a modest profit in the first quarter, helped by cost cuts. Melrose gave a statement that the group was trading in line with expectations ahead of interim results. It also added that it had disposed another business, Brush, for a net cash consideration of 100 million pounds.