Agriculture and engineering firm Carr's Milling Industries has agreed to sell its fertilisers unit to Origin Enterprises for £19m and intends to use the £3m proceeds to reduce its pension fund deficit.

Upon completion, Origin Enterprises will assume discharge the net debt of Carrs Fertilisers, which is expected to amount to about £5.9m.

Carrs Fertilisers has been hurt by weak fertiliser demand and high raw materials costs that resulted in an operating loss for the year ended August 2009. Carrs Fertilisers is engaged in blending raw fertiliser materials into finished product in England and Scotland.

Chris Holmes, chief executive officer, said, "The sale of Carrs Fertilisers to Origin removes a large exposure to commodity price fluctuations, which should reduce the volatility of Carr's profits."

Shares of the company slumped 6.1% to 787p in morning trade.

AR

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Carr's Milling Industries (CRM) share price
Origin Enterprises (OGN) share price