ATS Automation shares slip
Discussions to spin off its solar units end without agreement.
Cambridge, Ont. — Shares of ATS Automation Tooling Systems Inc. dropped more than seven per cent Monday after the company said discussions to spin off its solar-energy subsidiaries ended without an agreement.
The Cambridge, Ont.-based company was down 48 cents to $6.15 in morning trading on the Toronto Stock Exchange.
Earlier Monday, the company provided shareholders with the update after previously disclosing that it had been in talks with interested parties.
ATS, which makes machinery and equipment for industrial and automotive markets, had been exploring the sale of its solar businesses in France and Ontario, or a combined sale of both operations.
The company has been particularly focused on trying to shed its troubled solar-energy subsidiary in France, which has been a chronic financial drag on ATS.
“The state of economic conditions in Europe and further deterioration in the demand for solar products in France, and the rest of Europe, are negatively impacting Photowatt France,” the company said in a release.
The slowdown has “prompted the company to re-examine the viability of the spinoff alternative.”
The latest developments will cause a “modest delay” in its intended timeline for the separation of the solar business from its core automation business, it said.
“The company still expects to complete the separation without materially impacting growth plans for its core automation business,” it added.
ATS said it is considering a broader set of strategic options for both of the solar operations.
© 2011 The Canadian Press