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Flowgroup to sell energy division

Funds from the sale are needed to rescue the group's eco-friendly boiler business
March 23, 2017

An £81m valuation on just one division of a £12m company seems excessive, but that's the price broker Arden Partners thinks Flowgroup (FLOW) deserves for its energy business. Flowgroup's announcement that it has found a potential buyer sent the embattled group's share price up more than a third on the announcement of the sale.

IC TIP: Hold at 5.09p

Flow Energy - which sells and supplies energy in the UK - has been the group's saving grace in a difficult year. The government capped the number of the smart energy division's energy efficient micro-CHP boilers that could receive feed-in tariff payments, hampering the UK rollout. Flowgroup plans to sell its energy business, which made £135m of revenue in the year to January 2017, in order to fund the rollout of its boilers in Europe.