Potential buyer looks into UXC business

Potential buyer looks into UXC business

UXC has entered into a period of due diligence with one party to possibly purchase the whole company

An un-named company is looking to purchase UXC (ASX:UXC) in its entirety.

In a statement to the ASX, UXC said it had entered into a period of due diligence with one party.

"During the last four months the Board has examined various alternatives with a number of significant parties," the statement said. "While many of these parties currently remain interested, the Board has decided to enter into a period of exclusive due diligence with one of those parties that may or may not lead to a full bid for the company."

UXC chief financial and risk officer, Rowan Cole, told ARN the exclusive agreement meant other interested buyers can’t look into possibly purchasing it during this period.

“There have been other companies that UXC has spoken to in the past that have been interested in buying parts of the company such as Business Solutions, Professional Solutions or Field Solutions,” Cole said.

The due diligence period expires this month. Cole said there would be another announcement towards the end of the month or early August.

According to UXC, its IT group continues to show strong growth and is forecasting earnings before tax turnover totalling $450 million. The Field Solutions business has new orders in the pipeline brining in $200m in the past three months.

However, in the environmental sector, it has discontinued a large part of its activity, resulting in a significant reduction in turnover from its budgeted levels to about $270m. The discontinuation is due to a cessation of a number of Federal Government programs.

UXC claims budgeting for FY11 shows further growth and earnings without the problems of the discontinued business.

It has many entities under its belt including Integ, Red Rock Consulting and newly-named UXC Connect.

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Tags Mergers and acquisitionsUXC

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