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Expansion boosts Volex

Topaz Amoore
Wednesday 27 January 1993 19:02 EST
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SHARES in Volex, the electrical products maker, rose 24p to 440p yesterday after it announced a pounds 17.5m rights issue and a pounds 3.1m acquisition in pursuit of its expansion plans, writes Topaz Amoore.

Volex also issued a favourable profits forecast of not less than pounds 7.25m for the year ending March 1993, against pounds 3.68m in 1992. The final dividend will be maintained at 10.5p net per share.

The acquisition of Component Manufacturing Services, a US manufacturer of moulded cable assemblies, comes three months after Volex paid pounds 6.5m for a 60 per cent stake in Mayor, a Singapore-based manufacturer of data and power cord assemblies.

Alastair Defriez, of SG Warburg, which has underwritten the one-for-four rights issue at a price of 345p per share, said the jump in the share price reflected a 'belated realisation' of Volex's strengths.

The company plans to put the money left over from the acquisition into capital expenditure to promote organic growth.

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