P.M. BRIEFING : Racal Starts Reorganization
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LONDON — Racal, Britain’s leading defense and electronics firm, launched a plan today to sell off its telecommunications and security units and put its core businesses in a separate, management-owned unit.
Racal Electronics PLC said that it will shed its 80% of Racal Telecom PLC and Chubb security units and that management will buy out its remaining activities.
Racal said its shares in Racal Telecom will be distributed to Racal Electronics shareholders, while Racal Chubb Security Group also will be spun off, with shares distributed free to Racal shareholders.
It said Racal management, led by Sir Ernest Harrison, proposes to buy out Racal Electronics’ remaining activities.
The combined value of Racal Electronics and Racal Telecom was $10 billion, and the stock spinoff and unit sales would be valued at about that amount.
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