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Disposal of Dutch Subsidiary
Vega
3-Oct-2002 » Training Press Releases » VEGA Group PLC ("VEGA Group"), the business and IT solutions company, announces that on 2 September 2002 it disposed of its Industry business in Holland, VEGA Informatietechnologie BV to the local management team. Consideration for the disposal is £400,000 payable in cash on 2 September 2005 or earlier if the business is subsequently re-sold.
VEGA Informatietechnologie BV, will henceforth be called Magion Industrial Software Solutions BV ("Magion"). It provides process automation and IT engineers to the Dutch and Belgium process industry and industrial IT market, employing 50 people based just outside the Hague in Holland. Sales for the year to 30 April 2002 were €4.1m and operating profit was €273,000. Since then the business has been loss-making. Net assets are €1.1m. Other trading in the Benelux region previously carried out directly by VEGA Group PLC will continue unaffected by this disposal.
Immediately following the completion, VEGA Group PLC made available to Magion a secured working capital facility of €400,000, interest bearing and repayable within two years. An additional tranche of facility of €400,000 will be made available in January 2003 subject to Magion achieving certain performance criteria in the intervening period.
The transaction will result in a book loss on disposal of approximately £4.7m for the period to 31 October 2002 of which £3.9m relates to reinstated goodwill that was written off to reserves when the business was acquired in 1996.
Phil Cartmell, VEGA Group CEO commented:
"This is very good news for VEGA. Our Dutch subsidiary, part of the Commercial Industries business unit, is lossmaking and struggling to cope with the recessionary conditions in both the process automation industry and the Dutch market. With this disposal we have significantly reduced our future risk profile within our Commercial Industries business unit."
About VEGA
VEGA is a business and IT solutions company specialising in Control, Simulation, Learning, Knowledge, Security and Procurement.
VEGA was formed in 1978, specifically to provide consultancy and technical engineering services to international organisations, in the specialist field of satellite operations. Since then VEGA has successfully diversified throughout the aerospace, Government, industrial and commercial sectors. VEGA is headquartered in Welwyn Garden City with offices around the UK, in Heathrow and Bristol, Fareham and Stevenage, and internationally in Germany. VEGA employs 475 staff, many of which are placed on-site at client locations throughout Europe.
VEGA was floated on the stock market in 1992 and has a full listing on the London Stock Exchange. VEGA's shares are included within the FTSE Fledgling Index (Software and Computer Services classification) and the FTSE techMARK Index.
VEGA is also ISO 9001:2000 and Tick IT accredited through Det Norske Veritas. Our accreditation is valid from February 2003.
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