The Shaw Group Inc. announced it has entered into a definitive agreement to sell substantially all of its Energy & Chemicals business to Technip.
Under the terms of the agreement, Technip will acquire substantially all of the business of the Energy & Chemicals Group for approximately USD 300 million in cash consideration, subject to adjustment based on the Energy & Chemicals Group’s debt and working capital levels at closing.
Shaw will retain Energy & Chemicals Group personnel in its Baton Rouge office, which will be integrated into the company’s Plant Services Division, as well as Shaw Consulting International Inc., which will be incorporated into Shaw’s Environmental & Infrastructure Group. Shaw also will retain its Toronto-based operations and is reviewing options regarding future plans for this office. Additionally, Shaw will maintain its obligations under an engineering, procurement and construction contract associated with a large ethylene plant in southeast Asia that is now approximately 98 percent complete.
Shaw and Technip also have agreed to work toward developing future business relationships involving Shaw’s core business units.
Shaw expects to recognize a net pre-tax gain of approximately USD 15 million, or USD 10 million after tax, associated with the disposition of operations included in this transaction. The net gain also includes total charges of approximately USD 75 million pre-tax, which includes potential restructuring related to the businesses being retained, retention of the ethylene contract, transaction costs and other miscellaneous items.
