Cosalt shares sink as marine unit sale delayed

The troubled Grimsby-based group is selling the marine business to Survitec Group for £31m.

Cosalt’s chief executive Mark Lejman said the disposal of the business, which contributed about 59 per cent of overall revenue in the 2009 financial year, was now unlikely to be completed by July 22, as previously expected.

Cosalt’s senior lenders have agreed to extend the waiver relating to repayment of amounts due under existing facilities.

The extension, until August 19, is subject to the completion of the disposal by this date.

On May 3, the company announced the disposal of its marine unit, which include its UK and continental marine operations, to Survitec.

Survival equipment maker Survitec had first made a potential offer for the marine unit in November.

Cosalt, which provides safety equipment and services for the offshore oil and gas and marine industries, planned to use about £27m of the sale proceeds to reduce its bank borrowings, which stood at £30.2m on April 30.

Cosalt shares have shed 27 per cent since the company formalised the disposal of its marine unit in May.

Investors in the offshore oil and gas services group approved the sale of its marine safety business last month.

In May the group said it was terminating company secretary Neil Carrick’s role. His exit followed the departure of chief financial officer Mike Reynolds.

Earlier this year Cosalt revealed it may be forced to take impairment and exceptional charges totalling more than £17m following problems in its offshore division.