Low & Bonar, the international performance materials group, is set to sell its artificial grass yarns production business, for €27 million, to the Mattex Group, a major global business-to-business polymer-based, synthetic materials group. The disposal is expected to be complete by 31 August, 2016.

The disposal will comprise the sale of Bonar Emirates Technical Yarns LLC (“BETY”), Low & Bonar’s Abu-Dhabi-based grass yarns production facility, and the main production assets and the trade working capital of the grass yarns business in both Europe and the United States, together with certain assets from the other subsidiaries which comprise the sports & leisure business unit.

The Mattex Group will not acquire the Group’s Dundee factory, which will remain with Low & Bonar and continue to provide the base for the Group’s carpet yarn manufacturing business.

The net proceeds of the disposal will be used to reduce the Group’s net borrowings and provide flexibility and headroom to fund more profitable and cash-generative opportunities. It is anticipated that the disposal will be marginally dilutive to the Group’s earnings per share in the current financial year, but improve the quality of business and Group margins. (GK)