Melrose Restarts Sale Process for $3.5 Billion Nortek Division
(Bloomberg) -- Melrose Industries Plc restarted the sale process for its Nortek air management business, after the first attempt was interrupted by the coronavirus pandemic.
The U.K. buyout specialist said that Nortek, which makes heating and air conditioning products, is trading strongly with sales up 5% last year. There’s no certainty that a sale will be completed, Melrose said Thursday in a statement with annual results.
Melrose plans to seek as much as $3.5 billion for Nortek, Bloomberg News reported in January, citing a person familiar with the matter. The company said in September that it would review strategic options for the division in early 2021.
Melrose, which listed on the U.K. stock market in 2003, buys industrial companies and improves the way they’re run before selling them. Divesting Nortek would allow it to focus on turning around the operations of British aerospace and automotive supplier GKN, which counts Airbus SE as its biggest customer.
Melrose said Thursday that sales from its civil aerospace division dropped 27% last year, even as it saw a sharp second-half improvement its automotive and powder metallurgy businesses.
Bloomberg News first reported a year ago that Melrose was preparing the Nortek air management business for a sale. Then the coronavirus pandemic hit, disrupting companies and economies across the globe.
Margins at Nortek are now growing and reached 17% in the second half, Melrose said.
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