Weir Group agrees on the sale of Flow Control division

The Weir Group PLC is pleased to announce that it has entered into an agreement to sell its Flow Control division to First Reserve, a leading global private equity investment firm focused exclusively on energy, for an Enterprise Value of £275M, payable in cash and subject to customary working capital and debt-like adjustments at closing. The transaction remains subject to certain regulatory and other approvals, with completion expected in Q2 2019.

Flow Control primarily provides highly engineered pumps, valves and other solutions used in power, industrial and downstream oil and gas applications. The plan to sell the division was first announced on 19 April 2018 alongside the acquisition of ESCO, which further strengthened Weir’s leadership position in global mining markets. Once this transaction completes, on a pro forma basis, more than 80% of Weir’s revenues will be from attractive aftermarket-intensive mining and upstream oil and gas markets.

Weir will retain the UK defined benefit pension liabilities of Flow Control and accordingly has agreed with the trustees to make a £4M one-off contribution from the proceeds of the sale to the Group’s UK defined benefit scheme, which was closed to future accrual in 2015. In addition, certain of Weir’s US subsidiaries will retain the Flow Control legacy asbestos exposure together with corresponding insurance and will provide customary indemnification to First Reserve.

The transaction is subject to customary regulatory approvals.

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