<

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)			October 17, 2003
SEQUA CORPORATION
(Exact name of registrant as specified in its charter)
Delaware		1-804					13-1885030
(State or other jurisdiction       of incorporation)	(Commission File Number)					(IRS Employer Identification No.)
200 Park Avenue, New York, New York					10166
(Address of principal executive officers)				(Zip code)
Registrant's telephone number, including area code				(212) 986-5500
None
(Former name or former address, if changed since last report.)

Item 2. Acquisitions and Dispositions of Assets

     On October 17, 2003, Sequa Corporation (Sequa), through its Atlantic Research Corporation subsidiary (ARC), completed the sale of substantially all of the assets -- including the shares of ARC UK Limited -- and certain of the liabilities related to the propulsion business of ARC (collectively referred to as the ARC propulsion business). The sale to GenCorp Inc.'s Aerojet-General Corporation subsidiary (Aerojet) was pursuant to an agreement entered into by ARC on May 2, 2003. ARC received $133,000,000 in cash subject to certain adjustments. The proceeds will contribute to management's objective of strengthening Sequa's financial position. ARC Automotive, Sequa's automotive airbag inflator operation, was not included in the sale to Aerojet. Aerojet has entered into a long-term supply contract and license agreement to provide propellant and propellant development to ARC Automotive.

The ARC propulsion business employed approximately 900 employees primarily in the United States and was a leading developer and manufacturer of advanced solid rocket propulsion systems, gas generators and auxiliary rocket motors, and engaged in research and development relating to new rocket propellants. For the military contract market, the ARC propulsion business produced systems primarily for tactical weapons. For space applications, the ARC propulsion business produced small liquid fuel rocket engines designed to provide attitude and orbit control for a number of satellite systems worldwide.

Item 7. Financial Statements and Exhibits

(b)	Unaudited pro forma financial information of Sequa reflecting the sale of the ARC propulsion business.
	The unaudited pro forma consolidated financial information gives effect to the sale of the ARC propulsion business as if the disposition had occurred, for balance sheet purposes on June 30, 2003, and for income statement purposes on January 1 of each period presented. The Pro Forma Consolidated Balance Sheet at June 30, 2003 includes an estimated $0.4 million after-tax gain on the sale of the ARC propulsion business. This pro forma adjustment has not been made to the Pro Forma Statements of Operations as it will not have a continuing impact on Sequa's results of operations.
	The pro forma adjustments are based on presently available information. Sequa's final accounting for the disposition of the ARC propulsion business is still under review by management and will be finalized prior to the filing of Sequa's Annual Report on Form 10-K for the year ending December 31, 2003. The pro forma gain on the sale of the ARC propulsion business is based on the net book value at June 30, 2003 of the net assets sold and a preliminary purchase price which is subject to final cash settlement adjustments. Accordingly, Sequa's actual recording of the disposition may differ from the pro forma financial information. The unaudited pro forma financial information has been included as required by the Securities and Exchange Commission and is not necessarily indicative of the results that would have been reported had the disposition actually occurred on the dates specified, nor is it indicative of the results that may be obtained in the future.

Sequa Corporation and Subsidiaries
Pro Forma Consolidated Balance Sheet
At June 30, 2003
(Dollars in thousands)
(Unaudited)
							Pro Forma Adjustments
								Sale of
				Sequa				ARC						Other					Sequa
				Historical				Propulsion						Adjustments					Pro Forma
Current assets
	Cash and cash equivalents		$		138,476		$		133,094		(A)		$		(6,300	)	(G)	$		265,270
	Trade receivables, net				299,594															299,594
	Inventories				393,510															393,510
	Assets of discontinued operations				124,852				(124,852	)		(B)								-
	Deferred income taxes				56,891															56,891
	Other current assets				34,431															34,431
		Total current assets			1,047,754				8,242						(6,300	)				1,049,696
Investments
	Investments and other receivables				85,332															85,332
	Assets of discontinued operations**				105,355															105,355
					190,687				-						-					190,687
Property, plant and equipment, net					452,078				-						-					452,078
Other assets
	Goodwill				147,473															147,473
	Deferred income taxes				44,952				(22,463	)		(F)								22,489
	Deferred charges and other assets				31,024															31,024
					223,449				(22,463	)					-					200,986
Total assets			$		1,913,968		$		(14,221	)			$		(6,300	)		$		1,893,447
Current Liabilities
	Current maturities of long-term debt				8,750										(6,300	)	(G)			2,450
	Accounts payable				152,949															152,949
	Taxes on income				17,345															17,345
	Liabilities of discontinued operations				22,499				(22,499	)		(B)								-
	Accrued expenses				178,337				7,300			(E)								185,637
		Total current liabilities			379,880				(15,199	)					(6,300	)				358,381
Noncurrent liabilities
	Long-term debt				798,238															798,238
	Liabilities of discontinued operations**				18,316															18,316
	Other noncurrent liabilities				197,721															197,721
					1,014,275				-						-					1,014,275
Shareholders' equity
	Preferred and common stock				11,845															11,845
	Capital in excess of par				290,108															290,108
	Retained earnings				375,351				376			(D)								375,727
	Accumulated other comprehensive income				(79,454	)			602			(C)								(78,852	)
					597,850				978						-					598,828
	Less: Cost of treasury stock				78,037															78,037
		Total shareholders' equity			519,813				978						-					520,791
Total liabilities and shareholders' equity			$		1,913,968		$		(14,221	)			$		(6,300	)		$		1,893,447

**  Assets and liabilities of discontinued operations not related to the ARC propulsion business.

Sequa Corporation and Subsidiaries
Pro Forma Consolidated Statement of Operations
For The Twelve Months Ended December 31, 2002
(Dollars in thousands, except per share data)
(Unaudited)
						Pro Forma Adjustments
						ARC
		Sequa**				Propulsion			Other				Sequa
		Historical				Business			Adjustments				Pro Forma
Sales			$	1,688,498		$	(143,512	)	$	-			$	1,544,986
Costs and expenses
	Cost of sales			1,395,220			(115,505	)		-				1,279,715
	Selling, general and
	administrative			232,050			(15,517	)		-			$	216,533
				1,627,270			(131,022	)		-				1,496,248
Operating income				61,228			(12,490	)		-				48,738
Other income (expense)
	Interest expense			(63,651	)		43			159	(H)			(63,449	)
	Interest income			3,510			(145	)		-				3,365
	Equity in loss of unconsolidated   joint ventures			(77	)		-							(77	)
	Other, net			4,072			(378	)		1,297	(H)			4,991
Income (loss) before income taxes				5,082			(12,970	)		1,456				(6,432	)
Income tax benefit (provision)				4,100			5,500			(568	)	(I)		9,032
Income from continuing operations				9,182			(7,470	)		888				2,600
Preferred dividends				(2,064	)		-			-				(2,064	)
Income from continuing operations
	available to common shareholders		$	7,118		$	(7,470	)	$	888			$	536
Weighted average common shares
	Basic			10,412										10,412
	Diluted			10,415										10,415
Basic and diluted earnings per share
	from continuing operations		$	0.68									$	0.05

** The ARC propulsion business had not yet been classified as a discontinued operation in Sequa's Annual Report on
Form 10-K for the year ended December 31, 2002. The December 31, 2002 Consolidated Statement of Operations will reflect the reclassification of the ARC propulsion business as a discontinued operation in Sequa's Annual Report on
Form 10-K for the year ended December 31, 2003.

Sequa Corporation and Subsidiaries
Pro Forma Consolidated Statement of Operations
For The Six Months Ended June 30, 2003
(Dollars in thousands, except per share data)
(Unaudited)
							Pro Forma Adjustments
							ARC**
				Sequa			Propulsion		Other				Sequa
				Historical			Business		Adjustments				Pro Forma
Sales			$		817,796		$	-	$	-			$	817,796
Costs and expenses
		Cost of sales			688,081			-		-				688,081
		Selling, general and
		administrative			106,085			-		-				106,085
					794,166			-		-				794,166
Operating income					23,630			-		-				23,630
Other income (expense)
		Interest expense			(32,323	)		-		80	(H)			(32,243	)
		Interest income			1,395			-		-				1,395
		Equity in income of unconsolidated   joint ventures			5,707			-		-				5,707
		Other, net			1,286			-		566	(H)			1,852
(Loss) income before income taxes					(305	)		-		646				341
Income tax benefit (provision)					200			-		(252	)	(I)		(52	)
(Loss) income from continuing operations					(105	)		-		394				289
Preferred dividends					(1,032	)		-		-				(1,032	)
Loss from continuing operations available
	to common shareholders		$		(1,137	)	$	-	$	394			$	(743	)
Weighted average common shares
		Basic			10,433									10,433
		Diluted			10,433									10,433
Basic and diluted loss per share
		from continuing operations	$		(0.11	)							$	(0.07	)

** The ARC propulsion business was classified as a discontinued operation at June 30, 2003 and the results of its operations were shown below loss from continuing operations in Sequa's quarterly report on Form 10-Q for the quarterly period ended June 30, 2003.

Sequa Corporation and Subsidiaries

Notes to Pro Forma Statements

(Dollars in thousands)

(Unaudited)

Pro Forma Balance Sheet Adjustments:
	(A)	Estimated adjusted cash proceeds from the sale of the ARC propulsion business. The preliminary purchase price has been adjusted to reflect an estimated cash settlement adjustment as of June 30, 2003 as well as estimated direct selling costs. (See (D) below).
	(B)	Net operating assets of the ARC propulsion business sold and which were classified in discontinued operations in the June 30, 2003 balance sheet.
	(C)	Reversal of the cumulative translation adjustment related to the ARC propulsion business.
	(D)	Preliminary after-tax gain, in thousands of dollars, on the sale of the ARC propulsion business which was calculated as follows:
Preliminary cash proceeds			$	133,000
Estimated cash settlement adjustment				1,094
Estimated direct costs to sell				(1,000	)
Estimated adjusted cash proceeds				133,094
Book value as of June 30, 2003 of    net assets sold				(102,353	)
Reversal of cumulative translation adjustment				(602	)
Estimated other closing costs				(7,300	)
Estimated pre-tax gain on sale				22,839
Tax provision				(22,463	)
Estimated after-tax gain on sale			$	376
		The tax provision was calculated at a rate of 39% after adding back non-deductible goodwill.
	(E)	Estimated other accrued closing costs primarily consist of future lease payments, real estate taxes and the impairment of leasehold improvements on a leased facility that was excluded from the sale of the ARC propulsion business. The facility will be undergoing environmental remediation over its remaining lease term and cannot be returned to the landlord, or subleased for other productive purposes, until such remediation is complete.
	(F)	The tax effect on the sale of the ARC propulsion business.
	(G)	Portion of cash proceeds used to repay the Industrial Revenue Bond related to the ARC propulsion business.

Sequa Corporation and Subsidiaries

Notes to Pro Forma Statements

(Dollars in thousands)

(Unaudited)

Pro Forma Statement of Operations Adjustments:
	(H)		Elimination of discount expense associated with the sale of receivables as well as the interest expense on the Industrial Revenue Bond related to the ARC propulsion business. While there were no receivables sold as of June 30, 2003, the pro forma adjustments with respect to the Consolidated Statement of Operations give effect to the sale of the ARC propulsion business as though the disposition had occurred on January 1 of each period presented.
	(I)		The tax effect at 39% on the pro forma adjustments.
Note:			No pro forma adjustments have been made to impute interest income on cash generated by the disposition in excess of the amounts repaid related to receivables sold and presumed to be repurchased and the Industrial Revenue Bond related to the ARC propulsion business.
(c)		Exhibits
	2.1		Purchase Agreement by and between Atlantic Research Corporation and Aerojet-General Corporation dated May 2, 2003 pursuant to which ARC sold substantially all of the assets and certain liabilities relating to the propulsion business of ARC.
	2.2		First Amendment to the Purchase Agreement dated August 27, 2003.
	2.3		Second Amendment to the Purchase Agreement dated September 30, 2003.
	2.4		Third Amendment to the Purchase Agreement dated October 17, 2003.

	Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
		SEQUA CORPORATION
		BY	/S/ HOWARD M. LEITNER
			Howard M. Leitner
			Senior Vice President, Finance
			(Chief Financial Officer)
October 31, 2003