Cobham one step closer to offloading all non-core businesses

Aerospace and defence group Cobham has completed the disposal of another non-core division, the US emergency locator beacon business.

The firm sold this division to JF Lehman & Company for $73m in cash on a debt and cash-free basis, it was announced on Monday morning. An additional payment of up to $5m is subject to future events.

Meanwhile, Cobham has also divested its small European operation to management for a nominal sum. Both these sales are said to have generated a "modest" overall profit. They will be around 2% dilutive year-on-year to both 2012 and 2013 earnings.

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"This is the most significant remaining step, following the completion of the sale of the Analytic Solutions business in November 2011, towards achieving the divestment of the group's non-core activities," the company said.

The businesses design and manufacture beacons and emergency location transmitters, with activities in the US and Austria. Their exposure to outdoor recreational markets through retail outlets is now considered to be non-core to Cobham.

Warren Tucker, the group's Chief Financial Officer, said: "These transactions substantially complete the planned divestments of Cobham's non-core businesses, leaving us with a portfolio of focused businesses, each of which has differentiated technology and a leading position in attractive markets."

There are a few remaining non-core units to be sold still, thought they are "small, sub-scale businesses and product lines" that collectively generated annual revenue of just £20m in 2011.

BC