ASX 200 drops 1.4%

The S&P/ASX 200 Index (ASX:XJO) dropped by 1.4% today. The Cimic Group Ltd (ASX:CIM) share price fell 1% after giving an update.

The S&P/ASX 200 Index (ASX:XJO) fell by 1.4% today to 6,587 points.

The number of COVID-19 cases in NSW continues to rise and now Victoria has a cluster to deal with as well.

Here are some of the highlights from the ASX:

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Cimic Group Ltd (ASX: CIM)

The Cimic share price fell by 1% today despite announcing that it had completed the sale of 50% of Thiess, the world's largest mining services provider.

The company has previously advised that the price for 50% of the equity interest in Thiess implied an enterprise valuation of approximately $4.3 billion, based on 100% value of Thiess.

This will generate approximately $2.2 billion in cash proceeds for Cimic. The increase in the transaction cash proceeds compared to the previously estimated range is due to transaction closing adjustments and the final financial position of the underlying Thiess business.

Cimic executive Chair and CEO Juan Santamaria said: "The sale of 50% of Thiess enables us to capitalise on the sector outlook and Thiess' strong performance.

"The transaction proceeds will primarily be used to strengthen our balance sheet through the reduction of debt, while also providing additional capital to pursue organic growth prospects as well as broader capital allocation opportunities.

"Our retention of the remaining 50% reflects the ongoing strategic importance of Thiess to our business."

AMA Group Ltd (ASX: AMA)

AMA describes itself as the leader in Australian and New Zealand autobody repair industry and the vehicle aftercare and accessories market.

The AMA share price was flat today after announcing that the sale of the ACAD businesses, including the 'fully equipped' business and excluding the ACM Auto Parts and Fluiddrive businesses, to GUD Holdings Limited (ASX: GUD) completed today.

The proceeds of the sale of approximately $70 million will be used to retire debt resulting in a net debt position of approximately $158 million at 31 December 2020. The company expects to be in full compliance with its banking covenants at 31 December 2020.

AMA said its strong performance in the first quarter of FY21 continued into the second quarter with all states fully operational, with the exception of Victoria which will be fully operational by early January 2021.

The ongoing trend towards private transport over public transport continues to benefit the business. Cost management and the revised contracts implemented from 1 July 2020 are expected to deliver earnings before interest, tax, depreciation and amortisation (EBITDA) margins within its targeted range of 9% to 10% in FY22.

AMA Group CEO Andy Hopkins said: "The business experienced a quicker than expected return to normal repair volume and operations following the lifting of restrictions. The business is well placed to pursue strategic aligned acquisitions in the second half of FY21 aimed at delivering its growth and performance targets for FY21 and beyond."

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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