LONDON (Alliance News) - AIM-listed engineering company Hayward Tyler Group PLC Tuesday said it had got an offer for new banking facilities on improved terms from Royal Bank of Scotland Group PLC, a move that will remove the need for support from McNally Bharat Engineering, as it also unveiled its first ever interim dividend.
In a statement, the company said it will pay an interim dividend of 0.5 pence, which will be paid February 28.
Under the bank facilities offer, RBS will provide the company with banking and borrowing facilities of GBP14.2 million, up from the GBP12.9 million Hayward Tyler has under current facilities. The new facilities are committed rather than on-demand. It will also get an additional US facility of USD2 million from RBS,
"They extend the company's debt maturity profile and the associated interest rates will also be lower than those of the current facilities," Hayward Tyler said of the offer in a statement.
It hopes to finalise the new banking deal by mid-February.
Hayward Tyler said the new facility will allow it to repay the existing facilities, which are supported by McNally Bharat Engineering. It no longer needs that support.
McNally Bharat will therefore sell its 41.69% stake in Hayward Tyler.
"The business continues to see significant improvements in the trading environment. The combination of the improved banking facilities and the increased capacity at our Luton plant will allow us to continue growing and servicing our order book while maintaining our commitment to a progressive dividend policy," Hayward Tyler Chief Executive Ewan Lloyd-Baker said in the statement.
"We view the de-coupling of the loan from MBE as an important stepping stone in the Company's development. As we look towards the final two months of our financial year we are pleased to confirm that the company continues to trade in line with market expectations," he added.
Hayward Tyler shares were down 3% at 65 pence Tuesday morning.
By Steve McGrath; stevemcgrath@alliancenews.com; @SteveMcGrath1
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