GM Divests to Focus on Domestic U.S. Operations

Mukesh Buch
06 Mar, 2017
New York City

Armstrong Flooring net loss widened. CJS Solutions agreed to be acquired by India-based Tech Mahindra for $110 million. FairPoint Communications net fell 62%. GM agreed to sell Opel, Vauxhall and European financing units for $2.3 billion.

[R]4:10 PM New York – Armstrong Flooring net loss widened. CJS Solutions agreed to be acquired by India-based Tech Mahindra for $110 million. FairPoint Communications net fell 62%. GM agreed to sell Opel, Vauxhall and European financing units for $2.3 billion.[/R]

Tollbooth Index dropped 69.26 or 0.6% to 11,621.14.

Earnings Review

Armstrong Flooring Inc ((AFI)) tumbled 12.5% or $2.74 to $19.21 after the flooring solutions provider said net sales in the fourth-quarter ending in December fell 3% from a year ago to $271.7 million.

Net loss in the quarter widened to $6.3 million or 23 cents per diluted share from $16.6 million or 47 cents per share in the same quarter last year.

CJS Solutions Group LLC, the privately held healthcare information technology services provider agreed to be acquired by India-based software services provider Tech Mahindra Ltd for about $110 million.

Under the terms, Tech Mahindra will acquire 84.7% stake in CJS for $89.5 million in cash and remaining 15.3% will be acquire before 2019.

The transaction is expected to close before the end of April 2017.

FairPoint Communications Inc ((FRP)), the communications services provider stated revenues in the fourth-quarter ending in December slipped 2.8% from a year ago to $203.9 million.

Net income in the quarter plunged 62.2% to $16 million or 59 cents per diluted share from $42.3 million or $1.56 per share in the same quarter last year.

General Motors Company ((GM)) slumped 1.1% or 41 cents to $37.83 after the automobile manufacturer agreed to sell its European manufacturing unit Opel and Vauxhall and GM Financials’ European operations to PSA Group for €2.2 billion or $2.3 billion.

“For GM, this represents another major step and we are reshaping our company,” chairwoman and chief executive officer of General Motors Mary Barra said.

Novanta Inc, formerly GSI Group Inc ((NOVT)), the photonic components maker said revenues in the fourth-quarter ending in December jumped 10% from a year ago to $98.9 million.

Net income in the quarter surged 27.9% to $7.8 million or 22 cents per diluted share from $6.1 million or 18 cents per share in the same quarter last year.

In the first-quarter, Novanta forecasted revenues between $100 million and $102 million and diluted earnings per share in the year in the range of 22 cents to 25 cents.

The medical and industrial equipment maker lifted fiscal 2017 revenue estimate in the in the range of $430 million to $435 million from $384.8 million in a year ago period.