AIM-listed commodity trading services provider East West Resources has completed the sale of its wholly-owned subsidiary Ambrian Energy GmbH (AEG) to German wholesale oil trader HGM Energy GmbH for a cash consideration of 2.65m dollars.
AEG was East West Resources's buiofuels trading business and the group stated that it expected AEG to continue its operations under its new ownership.
AEG posted an unaudited pre-tax loss of £0.93m in the six months ending June 30th. This contrasted with a pre-tax profit of £0.95m for the year ending December 31st.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The sale comes three months after the board decided to focus resources on its core business of metal trading.
Based on unaudited management accounts for the year ending December 31st the group reported that it expected a loss on its continuing operations of around £1.0m. It said that this was largely as a result of the group's legacy overhead cost structure and a number of one-off costs.
Since the new financial year commenced with improved market conditions, the group reported that the metals business was trading "in line with expectations" and the order book "was significantly ahead of that at the equivalent point last year".
Commenting on the transaction, Charles Crick, Chairman of East West Resources, said: "The sale of AEG provides a timely opportunity for EWR [East West Resources] to apply its full resources to its metals trading business.
"At the same time, we are pleased to have found a new home for the biofuels business with a larger player in the sector, giving AEG a stronger platform for its activities. We can now focus our attention on building our core business in the metals and minerals industry."
East West Resources' share price was unaffected by the sale. As of 10:58 on Wednesday, the share price was unchanged at 11.0p.
MF
-
UK-US trade deal announced: US cuts tariffs on UK car imports to 10%Keir Starmer and Donald Trump have announced a UK-US trade deal, but the US president has refused to lift baseline tariffs on most UK goods. What does it mean for the UK?
-
How to use mid-caps to diversify from the USMedium sized companies are overlooked by investors but could offer an attractive ‘sweet spot’. We consider the case for mid-caps amid market volatility.
