600 Group rival backs off
MACHINE tool manufacturer 600 Group has welcomed the decision of rival Precision Technologies Group to walk away from mounting a takeover bid.
PTG had until yesterday to make an offer for the Leeds-based group but finally admitted that it had no intention of tabling a bid.
The put-up-or-shut-up deadline was imposed by the Takeover Panel after private equity-owend PTG's initial approach to 600 Group was rejected last month.
PTG, woned by London-based Venture Private Equity and Ferranti Capital, said it was “considering its position”, but when the deadline was reached yesterday the group, which includes machine tool makers Holroyd in Rochdale, and Jones and Shipman Precision in Leicester, walked away.
That saw the takeover offer period lapse for 600 Group, which was welcomed by chairman Martin Temple who said the Yorkshire group could now concentrate on its own operations.
Mr Temple said: “We are pleased that the lack of clarity or certainty regarding PTG's intentions, created by its announcement on October 5, 2007, has now been resolved. The board did not consider that PTG's indicative approach represented acceptable value for 600 Group shareholders.
“The board remains very confident of the company's prospects and will be updating shareholders on the continuing implementation of the company's stated strategy in the near future.”
Earlier this month 600 Group reported strength in its UK and European markets but “softness” in the United States. However the company believes that the weak dollar will see American manufacturers reversiing outsourcing decisions and investing in new equipment as they decide to manufacture at home rather than buy in from abroad.
600 Group, which is headed by former Yorkshire Group chief execurtive Andrew Dick, saw sales for the six months to September 29 increase by 10 per cent to £41m, from £37m last time.
Gross profit margins increased to 31 per cent and operating profit before financial income and tax was £600,000 compared to a £500,000 last year.
Pre-tax profits increased to £1.6m thanks to an increase in net financial income to £1.1m, which was due to the non-cash impact of the UK pension scheme.
