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(Sharecast News) - Tool and equipment hire business HSS Hire said on Thursday that it had agreed to sell its Power unit to CES Global for £23.25m.
HSS entered into an unconditional agreement to sell ABird and APEX Generators to further strengthen its balance sheet and also said it has entered into a commercial agreement with CES for the cross-hire of power generators and related services to ensure the broadest possible distribution of, and customer access to, both parties' existing fleets.
Power represented £34.0m of group revenues and £6.0m of group operating profits for the year ended 31 December 2022. Following the disposal, net debt on a non-IFRS16, pro-forma basis as of 30 December 2023 will reduce to approximately £37.0m.
In terms of its recent performance, HSS confirmed that trading for 2023 was in line with market expectations, with year-on-year revenue growth of 5%. Whilst HSS noted that it has "continued to see some demand softness" in certain customer segments, implementation of its marketplace proposition was said to be "progressing well", with self-service platform adoption accelerating with around 650 customers now having transacted on the platform.
Chief executive Steve Ashmore said: "Over the past three years, HSS has undergone a radical transformation, evolving to become a modern, agile marketplace business. Today's announcement will increase our focus on driving our strategy forward and delivering value for all our stakeholders.
"Power has made an important contribution to the group and I would like to thank the team for their commitment over the years. I am very pleased that they will be joining CES, who recognise the business's value and will help it reach its full potential. HSS will continue to work with Power to provide our UK customers with all of their power solution hire requirements."
As of 1015 GMT, HSS shares were 1.12% higher at 9.0p.
Reporting by Iain Gilbert at Sharecast.com
