MEXICO CITY -- Mexican conglomerate Desc hopes to raise up to $85 million from the sale of a stake in its Velcon car parts unit as part of a restructuring of its business portfolio to cut debt, the company said on Wednesday.
Desc, which has auto parts, chemicals and real estate divisions, said it had a preliminary agreement to sell 51 percent of its stake in Velcon to GKN Industries for between $80 million and $85 million.
Hard hit by the economic slowdown of the past three years, Desc said it expected to use the proceeds to reduce its debt.
As of the end of June Desc had net debt of $733 million. The company aims to reduce that to between $650 million and $700 million by the end of 2004.
Desc said in January it had reached an agreement with bank creditors to restructure debts worth $720 million and postpone their maturity for up to five years.