Morse flogs French business for €1 (and then some)
Upbeat trading update
Morse has sold its French subsidiary, Morse France SAS to Opengate for €1 – and maybe €1m in performance-related cash in the period to 30 June 2007. It is taking an non-cash charge of €7m on the disposal.
Morse France turned over £11m in the most recent quarter – just under 10 per cent of group revenues. So the sale price looks like a snip, considering that the subsidiary made an operating loss of just £600,000 for the year to end of June.
Morse says the French business is no longer core to the group, as it derives most of its revenues from infrastructure – in other words, selling computer hardware. Investment to turn France into a more service-oriented company would cost too much, it says.
Yesterday the group issued an upbeat trading update, saying it has surpassed profit estimates. Sales for the year to end of June wer £428m and operating profit before exceptionals and goodwill will come in at “not less than £9.5m”.
During the year, the company reduced its UK headcount by 100. It says that the transition from product reseller to full-blown services company is progressing well.
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