600 Group calls off dialogue with suitor

Shares in machine tool maker The 600 Group fell seven per cent last night after the firm said it had terminated talks with Chinese suitor Qingdao D&D Investment Group.

At the end of last year the Heckmondwike-based group said a sale of selected assets to D&D would be a better move forward for its shareholders than a full-blown takeover.

But yesterday it said that despite extensive discussions over recent weeks, D&D had failed to make progress on agreed and continually extended deadlines.

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As a result 600 said it believes that D&D is unlikely to complete a transaction and it has told the Chinese firm that all discussions about the potential sale of assets have been terminated.

600’s shares closed at 16.98p last night. The firm said that during the sales process every care had been taken to avoid management from becoming distracted.

It added that trading for the second half of the year is in line with the board’s expectations.

In a statement, the company said: “The directors believe that the business will deliver significant value for shareholders over the medium term.

“With any uncertainty relating to this possible sale set aside, the board is now in a position to develop and communicate future strategy in due course.”

600 started takeover talks with D&D last September.

600 recently returned to profit and said business confidence is slowly returning to its major markets as developed economies show a renewed interest in manufacturing and investment. The group reported a £940,000 pre-tax profit in the six months to September 28.