Engineering firm sells off gas ignition arms

THE parent group of a Scottish engineering firm is selling off two of its businesses to concentrate on selling equipment made in East Kilbride.

Out-going chief executive Kevin Baker is paying Aim-listed Active Energy a total of 545,000 to buy the two subsidiaries, leaving the company free to concentrate on SDC Industries.

SDC makes voltage transformers that step down the electricity entering a factory from the UK standard of about 240 volts to the European level of 220 volts.

Active Energy said the transformers help businesses to save money by cutting their energy bills and reducing their greenhouse gas emissions.

Under yesterday's deal, Baker will buy Derlite, a Thailand-based company that designs, makes and sells gas ignition equipment to manufactures of gas appliances throughout the world, and Gasignition, a UK-based distribution company.

Baker will stand down as chief executive, with Philip Palmer becoming executive chairman.

Active Energy expects to make costs savings of about 150,000 a year following the disposal.

Palmer said: "With the disposal of our two mature, legacy businesses, we are now able to focus fully on our ambition to become a leading supplier of voltage optimisation products.

"The voltage optimisation market represents an exciting growth opportunity for Active Energy and we look forward to building our presence in this early-stage market."

Shares fell 0.25p to 4.62p.