Valmont Selling Stake in Bilston Investments
On Thursday, industrial conglomerate Valmont Industries announced that it has sold its stake in South African manganese producer Bilston Investments Proprietary Limited. A trio of South African purchasers will buy Valmont's 49% interest in Bilston for a total purchase price of $30 million.
In a statement, Valmont noted that Bilston contributed about $5.1 million to its after-tax profit in 2012, or less than 2.2% of company earnings. Still, this implies the company is getting less than six times earnings for its stake in the company -- a considerable discount to the 17.4-times-earnings valuation its own shares command.
Unsurprisingly, investors are reacting negatively to the news, bidding Valmont shares down 1.4% in Thursday trading, to $152.26.
The article Valmont Selling Stake in Bilston Investments originally appeared on Fool.com.Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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