Chemring to sell US subsidiary to Norway's Nammo for $17m
Defence engineer Chemring has agreed to sell its US subsidiary, Chemring Ordnance, to Norway-based aerospace and defence company Nammo Defense Systems for $17m in cash, completing the exit from its commoditised energetics businesses.
The sale, which is subject to regulatory approval in the US, is expected to complete by the end of the second quarter of next year.
Located in Florida, Chemring Ordnance manufactures a range of ordnance and pyrotechnic products primarily for military customers. In the year ended 31 October 2018, it generated revenue of $57m and an underlying operating loss of $0.2m.
Proceeds from the sale will be used for general corporate purposes.
Chief executive Michael Ord said: "This transaction is another step in the delivery of our strategy and provides a greater focus on our growing and differentiated positions in sensors & information and countermeasures & energetics.
"Today's announcement concludes the process of exiting the group's commoditised energetics businesses and further improves the quality of the group and its future earnings."