Home entertainment products supplier Armour Group is selling its in-car entertainment division for £10.9m, which more than covers its debt.
However, excluding a £3m gain on disposal, it will mean that Armour will report a loss in the year to August 2014 - a profit of £510,000 had been forecast. Breakeven is forecast for 2014-15 but the cash in the bank is likely to be used to grow the business so it could be different by then.
AAMP America is acquiring the division on an operating profit multiple of just over seven. The division contributed a profit of £1.76m and the remaining operations make a small profit before central overheads. Even a reduced interest charge will still mean a £1.15m loss for 2013-14.
Armour has been hampered by its high debt levels and it will be in a better position to grow its home entertainment and Asian businesses.
At 5.38p a share, up 0.63p, Armour is valued at £5.22m.
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