(Alliance News) - Weir Group PLC on Tuesday announced it has completed the USD405 million sale of its oil & gas division to Caterpillar Inc.
Back in early October, Glasgow-based mining technology company Weir agreed to sell its entire oil & gas division to Deerfield, Illinois-based construction machinery firm Caterpillar for a USD405 million enterprise value, and said proceeds from the sale would be used to reduce the company's leverage.
Weir noted in December that while a majority of regulatory clearances had been received, a small number of approvals remained outstanding at the time, with the timing of some standard processes delayed by Covid-19 restrictions. As of Tuesday, all clearances have now been received.
In addition, Weir said its joint venture partner in Saudi Arabia, Arabian Metals Co has exercised its pre-emption right to purchase Weir's 49% stake in Arabian Metals. As a result of this, cash proceeds from the oil & gas division sale will be split between USD375 million received from Caterpillar and USD30 million to be received on completion of the Arabian Metals sale, which Weir expects to occur during the first half of this year.
"I would like to thank the oil & gas team for their magnificent contribution to Weir over the years. The sale delivers a great new home for the business and its people, and enables Weir to fully focus on our role as a provider of premium technology to global mining and infrastructure markets," said Chief Executive Jon Stanton.
Shares in Weir Group were up 0.5% at 1,917.00 pence in London on Tuesday.
By Zoe Wickens; zoewickens@alliancenews.com
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Weir Group (WEIR)