HUDDERSFIELD building products group Heywood Williams today sold its loss-making double glazing business.
The Edgerton-based firm has sold double glazing retailer Coldseal Ltd to a newly-formed privately-owned group.
In exchange, Heywood Williams takes a 19.9% stake in the new Coldseal Group Ltd.
The new group was set up specifically for the deal by the Bryco Group, a double glazing retailer based in London.
Heywood Williams also has an agreement to supply products to Coldseal for the next three years.
Group chairman Hamish Bryce said Heywood Williams would incur one-off costs totalling £26m as a result of the sale.
But he said the sale of the "volatile" business would improve the prospects of Heywood Williams' main UK business making sealed glass units, plastic doors, windows and conservatories.
Heywood Williams would also be able to focus more attention on developing its US operations, which include making plastic pipes for the construction industry.
The move comes just nine days before Heywood Williams announces its half-year results.
Coldseal employs 500 people and is based in Nottingham.
The subsidiary operates mainly in the Midlands and the south and is the third largest regional double glazing retailer behind Anglian Windows and Everest.
Coldseal made losses of £5.7m in 2002 on sales of £61m.
Mr Bryce said: "Coldseal's performance has historically been volatile, impacting adversely on group performance.
"The board has carefully considered a full range of strategic options.
"This transaction proved to be the most attractive, involving the sale of the business to an established retail double-glazing specialist while retaining an interest in its future success and an ongoing trading relationship based on a three-year supply agreement."
In a trading update last week, Heywood Williams said it expected to make losses of £1.7m for the first six months of 2003 - due to poor market conditions in the US and "the delayed turnaround" of its UK businesses.
The interim results will be announced on September 3.
