(Alliance News) - Synthomer PLC on Monday said it has sold its latex compounding operations to Belgian company Matco NV for EUR27.5 million.

Shares in the Essex, England-based chemicals manufacturer were down 2.6% to 259.00 pence each in London on Monday around midday.

The Compounds business, which is part of Synthomer's Health & Protection and Performance Materials division, was designated as non-core as part of its strategy update. The update was announced back in October 2022.

"It produces certain latex-based compounds and curing additives used in the manufacture of products for a range of end markets including flooring and artificial grass. The business comprises two manufacturing sites in the Netherlands and one in Egypt," Synthomer explained.

In 2023, the Compounds business generated adjusted earnings before interest, tax, depreciation and amortisation of EUR4.8 million. It had gross assets of EUR56 million at the end of the year.

Synthomer expects to complete the sale over the next month, with the proceeds to be used to reduce the company's net debt.

Chief Executive Michael Willome said: "This divestment is consistent with our strategy to increase the specialty weighting of the group, reduce the complexity of our site portfolio and enhance our focus on higher value, higher growth markets where we have strong and sustainable leadership positions."

By Sophie Rose, Alliance News senior reporter

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