10 December 2018 – disposal

The group has announced that is has agreed to dispose of its Alternative Energy business, which has been a disappointing performer to Creation Capital for £11.1m.  In a relatively complicated deal, Pressure Technologies will receive £5m in cash, £2m of shares in Creation Capital and a £4.1m promissory note issued by the latter.  This will mature in 24 months and will pay interest at 7% during its life – half will be denominated in Canadian dollars and half in sterling.  The funds received will be used to pay down debt although more will become apparent tomorrow when the group announces full year results.  As the stock was only recommended last week we maintain our recommendation of BUY.