Sims Limited Sells Surplus Land for $31.5M

Rhea-AI Summary

Sims Limited (SMSMY) has sold 8.2 acres of land in Newark, New Jersey, for $31.5 million. The company will receive 85% of the proceeds by December 2022, with the remainder before June 30, 2023. This sale is part of Sims' strategy to divest unproductive or non-core assets and reinvest the proceeds into core growth opportunities. Previous asset sales, like the 50.5% stake in Sims Municipal Recycling, demonstrate this approach. The firm aims for a minimum internal rate of return of 15% on these investments.

Positive

• Sale of land for $31.5 million enhances capital management.
• 85% proceeds available by December 2022 allows for swift reinvestment.
• Strategic divestment approach aimed at funding core growth assets.

Negative

• None.

NEW YORK, Dec. 18, 2022 /PRNewswire/ -- Sims Limited (ASX: SGM), a global leader in sustainability and an enabler of the circular economy, today announced the sale of 8.2 acres of land, located at 250 Doremus Avenue in Newark, New Jersey for $31.5 million. Eighty-five percent of the proceeds will be received in December 2022, and the balance will be received before June 30, 2023.

This sale represents tangible progress in the company's ongoing review of identifying unproductive or non-core assets for disposal and subsequently redeploying the proceeds to core growth assets.

The previous sale of a 50.5 percent stake in Sims Municipal Recycling is an example of a non-core asset identified during this review process. The proceeds were recycled to substantially fund the acquisitions of Recyclers Australia and Atlantic Recycling Group.

"The sale of this land in New Jersey demonstrates our commitment to disciplined capital management, and we will use the proceeds to fund core growth assets that deliver returns at or above our IRR hurdle of 15 percent," said Alistair Field, managing director and chief executive officer at Sims Limited. "Selling unproductive and non-core assets allows us to free up capital to continue funding transformative assets, such as the Pinkenba land acquired in FY21, without significantly changing our capital profile. We have achieved excellent outcomes through recycling capital and anticipate further divestments," Mr. Field concluded.

About Sims Limited 
Founded in 1917, Sims Limited is a global leader in sustainability and an enabler of the circular economy that employs 4,400 employees who operate from more than 200 facilities across 15 countries. The company's ordinary shares are listed on the Australian Securities Exchange (ASX: SGM), and its American Depositary Shares are quoted on the Over-the-Counter market in the United States (USOTC: SMSMY). The company's purpose, create a world without waste to preserve our planet, is what drives them to constantly innovate and offer new solutions in the circular economy for consumers, businesses, governments and communities around the world. For more information, visit www.simsltd.com.

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SOURCE Sims Limited

FAQ

What is the significance of the land sale by Sims Limited on December 18, 2022?

The sale of 8.2 acres for $31.5 million represents Sims Limited's strategy to divest non-core assets and reinvest in growth opportunities.

When will Sims Limited receive the proceeds from the land sale?

Sims Limited will receive 85% of the proceeds in December 2022, with the remaining amount before June 30, 2023.

How does Sims Limited plan to use the proceeds from the land sale?

The proceeds will be used to fund core growth assets that yield returns of at least 15%.

What previous asset sales has Sims Limited conducted?

Sims Limited previously sold a 50.5% stake in Sims Municipal Recycling, using the funds to support acquisitions.