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SIG Terminates Deal To Sell Building Solutions To Kingspan; Stock Dips

Shares of SIG plc (SHI.L) were losing around 9 percent in the early morning trading in London after the distributor of specialist building products announced Thursday that it has agreed to terminate the agreement to sell Building Solutions (National) Limited to Kingspan Group Plc (KGP.L).

It was in October last year that the companies agreed on the disposal of Building Solutions for a consideration of 37.5 million pounds on a cash free, debt free basis. The disposal was conditional upon the approval of the UK Competition & Markets Authority or CMA.

On April 21, the CMA referred the disposal for a Phase 2 investigation, following the outcome of its Phase 1 decision on April 7.

The sale and purchase agreement regarding the disposal expires on July 7.

SIG noted that the CMA's Phase 2 investigation is anticipated to conclude in October 2020 and accordingly the date in the Agreement would need to be extended in order for the Phase 2 investigation to be carried out.

Due to the prevailing covid-19 related market conditions, it has not been possible for SIG and Kingspan to agree commercial terms for the extension of the agreement.

The company said it is currently reviewing a number of options regarding the Building Solutions business and will provide further updates when appropriate.

In London, SIG shares were trading at 23.53 pence, down 8.81 percent.

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