LONDON, U.K. Invensys, the international production technology and energy management group, has agreed to sell its Invensys Flow Control business to Flowserve Corp., a provider of industrial flow management services, for cash consideration of $535 million.
The sale proceeds will be used by Invensys to reduce its level of indebtedness.
Invensys Flow Control is a manufacturer of valves, actuators and associated flow control products mainly to the oil and gas, chemical and petrochemical, power generation and process industries. For the twelve months ending March 31, 2002, the business is expected to generate revenues and PBIT of around US$520 million and US$65 million respectively.
Net assets which are the subject of the transaction are approximately US$330 million. Goodwill written off to reserves relating to acquisitions made over the last 25 years for the Flow Control business amounts to approximately $130 million.
The sale of Flow Control is consistent with Invensys' previously stated objectives to divest non-core assets as part of its overall plan to improve capital strength and increase strategic focus. The transaction is subject to customary regulatory approvals, the consent of Flowserve's lenders, completion of transaction financing and consultative procedures. The transaction is expected to complete by the end of May 2002.
Rick Haythornthwaite, CEO of Invensys said: "We identified Flow Control as a non-core business before the current strategy review. The combination of Flow Control with the Flowserve businesses should provide considerable opportunities to enhance the growth prospects of both businesses. The sale is good value for the company and reinforces our commitment to reducing debt and strengthening the balance sheet."
Invensys Flow Control
Invensys Flow Control is a manufacturer of valves, actuators and associated flow control products, including steam systems, with manufacturing facilities throughout the Americas, Europe and Asia.
Invensys plc
Invensys plc, the international production technology and energy management group, specializes in helping companies to improve efficiency, performance and profitability. With close to 76,000 employees, Invensys is headquartered in London, England.
Production Management businesses work closely with customers in order to drive up performance of their production assets and maximize the return on investments in product technologies. The division includes Foxboro, Wonderware, Triconex, APV, Eurotherm and Baan and it addresses the oil, gas, and chemicals; food beverage and personal healthcare; and discrete and hybrid manufacturing sectors.
Energy Management businesses actively work with clients involved in both the supply and consumption of energy, developing systems using innovative technologies that improve the reliability and security of power supplies. The division includes Energy Solutions, Metering Systems, Appliance and Climate Controls and Power Systems and focuses on markets connected with power and energy infrastructure and commercial and residential buildings.
About Flowserve Corp.
Flowserve Corp. is a provider of industrial flow management services. Operating in 30 countries, the company produces engineered pumps for the process industries, precision mechanical seals, automated and manual quarter-turn valves, control valves and valve actuators, and provides a range of related flow management services. The company had fiscal 2001 revenues in excess of $1.9 billion.
