News

Macfarlane Group has sold its "non-strategic" manufacturing operations in the US and Mexico to Specialized Packaging Group LP for £3.8m in cash.

The firm said £3.6m would be paid immediately, with the remainder becoming payable in January 2008. The proceeds will be used to "further reduce" its borrowings.

California-based Macfarlane Western Foam Packaging Products and Macfarlane de Mexico in Tijuana, Mexico, which design and manufacture foam packaging components, had a combined operating profit of £200,000 on turnover of £18.2m to 31 December 2006.

The businesses had unaudited net assets of £5.3m at 30 September 2007.

Following its interim results last month, Macfarlane chairman Archie Hunter said its interests would be best served by concentrating on business activities with "good market positions and growth potential".

The directors estimate the sale will produce a "realised loss" of £1.7m in the current financial year ending 31 December.