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On Monday, ATM manufacturer Diebold (NYSE: DBD ) announced a plan to sell its manufacturing operations in Lynchburg, Va., and Lexington, N.C., to one of its own suppliers, Porter's Group. Financial terms were not disclosed.
Based in Bessemer City, N.C., Porter's has supplied fabricated sheet metal to Diebold for years. The factories it is buying today include one (Lynchburg) that fabricates sheet metal components for Diebold's ATMs, and a second (Lexington) that makes safe deposit boxes and other secure containers for bank branches. Diebold is retaining its Greensboro, N.C., factory that does final assembly on ATMs.
The move doesn't appear to be aimed at raising cash -- Diebold has a pretty solid balance sheet, boasting nearly as much cash as debt. Rather, Diebold says it's simply aiming to consolidate operations and boost efficiency in its supply chain.
Investors, however, reacted negatively to the news, bidding down Diebold shares 1.7% to close at $27.61 in Monday trading.