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(Alliance News) - Essentra PLC on Monday promoted Scott Fawcett to chief executive, as Paul Forman plans to step down following the sale of its Filters and Packaging divisions.
Shares in the Milton Keynes, England-based components, packaging and filter maker were up 13% to 207.00 pence each in London on Monday morning.
Forman joined the company back in 2017 as CEO. Essentra said that during this time he embarked on a "stability, strategy, growth" journey refocusing the company on its core divisions and restoring them to long-term revenue and profit growth.
In 2021, the company announced that it would review its Packaging and Filters divisions, in order to reposition itself as a pure-play components business. The review concluded that the sale of both arms would be in the "best interest" of shareholders.
Essentra announced on Monday that its Filters business has been sold to a wholly owned subsidiary of Centaury Management Ltd for an enterprise value of approximately GBP262.1 million. It expects the sale to be complete by January 31 next year.
Back in June, the company said it had sold its Packaging arm to Mayr-Melnhof Group for GBP312 million. This sale was completed on Friday.
The board said it intends to use the cash from the sales to prepay a portion of US private placement debt and make a small contribution to the company's defined-benefit pension schemes.
It added that it plans to return GBP150 million to shareholders through a special dividend after the Filters disposal has completed.
"After completion of the sale of the Filters business, Essentra will be established as a pure play components business, with a healthy balance sheet, providing flexibility to pursue organic and inorganic growth opportunities," the company said.
Essentra explained that Forman will step down at the end of the current financial year on December 31, now that the review has been completed.
Forman will be replaced by Fawcett, who has been the managing director of the Components division since 2017.
Fawcett joined Essentra in 2010 as managing director of the European business and subsequently joined the Group Management Committee in 2014.
Essentra said that Forman will work closely with Fawcett to ensure a smooth transition and support the company's transition to a pure-play components business.
Chair Paul Lester said: "Following a thorough review, the Nominations Committee unanimously recommended to the board that Scott be appointed as the company's new CEO. Scott has extensive knowledge and experience of the Components business and a successful track record of developing and expanding the division both organically and through acquisition."
By Sophie Rose; sophierose@alliancenews.com
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