After a competitive process, Elementis has entered into an agreement to sell its Surfactants business in Delden to Kolb Distribution AG for a cash consideration of €39m. We consider this a positive conclusion to the planned disposal of this non core, loss making and capital consumptive business. As expected, Elementis enters into a supply agreement with Kolb for continued sourcing of certain products for its Specialties division from the Delden site. This will be modestly dilutive to earnings from FY18 (mechanically our EPS reduces by c.6%) but strategically we consider this the right transaction for the Group and we continue to view our underlying assumptions as being conservatively positioned.
