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TROUBLED RACAL PLANS TO FLOAT OFF US DATA PRODUCTS DIVISION

The US-based Data Products arm of troubled Racal Electronics Plc is likely to be floated separately on the Nasdaq exchange, according to the unit’s head Paul Kozlowski. Racal, the UK defense and electronics group, has hired investment bankers Goldman Sachs to advise on what to do with the US based unit, which made operating losses of 19.1m pounds on sales of 281m pounds last year, including a 29m pound charge for restructuring. At present, the only option being explored is that of flotation, with the parent company retaining a majority holding of around 60%. The target is for a float next Spring but this is dependent on the division’s return to profit, something which Kozlowski is confident of, now that restructuring is complete. As a group, Racal saw its profits fall by 32% to just 32m pounds last year and US investment banking giant, Merrill Lynch, has been hired to sort out Racal’s Network Services division.

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CBR Staff Writer

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