Atlas Copco takes hit on RSC
Atlas Copco’s fourth quarter earnings will include a charge of around SK850 million after it decided to write down to zero the value of its right to a conditional extra-payment on its divestment of RSC Equipment Rental in October 2006 See Atlas Copco sells RSC
When Atlas Copco sold RSC to private equity firms Ripplewood Holdings and Oak Hill Capital Management they agreed to make extra payments if the acquired business reached certain EBITDA profitability levels.
Atlas Copco said on Friday that RSC’s EBITDA is not anticipated to reach the levels that would require RSC to make a further payment. Atlas Copco currently still holds around 11.5 percent of RSC’s equity.