De La Rue sells off cash systems unit

De La Rue sells off cash systems unit

British bank note printer De La Rue is selling its cash systems division to US private equity firm Carlyle Group in a £360 million cash deal.

Under the terms of the deal, currency production outfit De La Rue willl sell the business for a consideration of £360 million on a cash and debt free basis.

The vendor says it will return about £460 million of capital to shareholders, equivalent to 305 pence per share. This includes £160 million previously announced with De La Rue's full year results in May.

The cash systems unit provides teller automation technology for dispensing, accepting, counting and authenticating bank notes. It also supplies dispensing mechanisms to ATM manufacturers. However De L Rue says the deal does not include its cash processing division, which provides banknote sorters.

For the year ending 29 March 2008, the cash systems division generated revenue of 286.6 million and operating profit of £35.5 million. De La Rue began looking for a buyer for the unit last November after deciding the business offered "little opportunity for synergies" with its prime security paper and print division.

The vendor says it will now focus on offering banknote printing and paper to central banks, governments and international corporations.

Commenting on the deal, Nicholas Brookes, chairman, De La Rue, says: "The disposal of cash systems, in the more uncertain economic environment, reflects the quality of the business that we have built since 2004 and crystallises its value for our shareholders."

The agreement is subject to shareholder and regulatory approval.

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