Invensys sells car parts business

Invensys is trying to cut its debt burden

The engineering and electronics group Invensys is selling its car parts business Rexnord for $880m (£562m).

It is the latest stage of a restructuring plan, designed to raise £1.5bn in order to cut the company's £3bn debt.

But news of the sale was tempered by a warning that profits this year would be at the lower end of analysts' expectations because the weak dollar had hit earnings in the US.

The company said the economic environment remained fragile and its telecoms and IT services markets were weak.

Chief executive Rich Haythornthwaite said the sale of Rexnord meant that the group had already met its £1.5bn goal with two businesses still to sell.

"We are delighted at the speed at which we have reached this target," he said.

Shares fall

Rexnord, based in Milwaukee in the US, has more than 5,000 employees and specialises in making clutches and brakes.

The two businesses still to be sold are Invensys Drives, which makes ski lift mechanisms, and Fasco Motors.

Invensys is probably best known for making controls for domestic appliances such as washing machines.

It was formed in 1999 from the merger of BTR and Siebe and operates in 80 countries.

Shares in the company closed down by more than 7% at 60.75p.