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.
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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.
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