SIG abandons sale of building solutions business to Kingspan
SIG shares slid on Thursday as the building materials supplier said it had terminated the proposed disposal of its building solutions business to Kingspan.
The £37.5m sale, which was announced in October 2019, was conditional on approval from the UK Competition and Markets Authority, which referred the deal for a Phase 2 investigation last month.
The sale and purchase agreement expires on 7 July, while it’s expected that the competition watchdog’s in-depth investigation will conclude in October. As a result, the date in the agreement would need to be extended in order for the CMA’s investigation to be carried out.
However, SIG said that due to "prevailing market conditions", it has not been possible for both companies to agree commercial terms for the extension of the agreement.
"Accordingly, the parties have agreed to terminate the agreement with immediate effect and the disposal therefore will not proceed."
SIG said it’s reviewing a number of options regarding the business and will provide further updates when appropriate.
At 1000 BST, the shares were down 6% at 24.22p.