JSE-listed rolled aluminium products manufacturer Hulamin will sell its aluminium extrusions business Hulamin Extrusions to Norsaf ERS for R10-million.

The proceeds from the proposed transaction will be used to pay Hulamin's trade creditors, reduce its debt and fund the working capital requirements of the group, Hulamin says.

The net asset value of Hulamin Extrusions at December 31, 2025, was R44.9-million and it incurred a loss after tax for the year of R35.67-million.

The balance for trade debtors was R37.79-million on this date, the balance for its trade creditors was R13-million, the balance for its stock was R61.9-million, the balance for its cash was zero, and the balance for its loan account at December 31, 2025, was R76-million.

The proposed transaction must be approved by the Competition Commission by July 31, and does not require approval by the shareholders.

During a strategic review by Hulamin of its assets, Hulamin Extrusions was identified as a noncore asset and earmarked for disposal to enable the redirection of resources and management attention to the group's core rolled products activities.

The proposed transaction aims to support improved cost efficiency, liquidity, capital allocation discipline and strategic execution, the company says.

Hulamin Extrusions will assign to Norsaf ERS its rights to amounts owed by trade debtors and will transfer ownership of stock on hand to it at book value, which will be held on consignment and drawn down, also at its book value, according to the consignment stock agreement between the parties.

At March 31, 2026, Hulamin Extrusions' unaudited management accounts reflected a stock balance of about R106-million. It expects this amount to reduce considerably by the closing date.

Accordingly, the amount to be paid in respect of the consignment stock and any loan account waiver in favour of Hulamin will not, in aggregate, exceed R100-million.

All of the consignment stock will be deemed to have been drawn by Hulamin Extrusions by October 30, and the final amount in respect thereof will be payable by not later than 60 days from that date.

Further, Hulamin will assume responsibility for the settlement of all trade creditors of Hulamin Extrusions, while Hulamin Extrusions will transfer all cash in any bank accounts of Hulamin Extrusions to Hulamin.

Any amount owed on loan account by Hulamin to Hulamin Extrusions, after adjustments, will be written off.

Additionally, Hulamin Extrusions will continue to occupy the premises from which it operates for a limited period of time, governed in terms of the lease and shared services agreement.

The lease agreement will endure for a period of 12 months from the closing date, with an option to renew for a further 12 months.

Hulamin Extrusions is a manufacturer and supplier of standard and custom for use largely in the automotive, transport and other engineering and architectural related markets.