Invensys has announced that it has agreed to sell its Invensys Flow Control business to Flowserve Corporation for a cash consideration of $535 million.The sale proceeds will be used by Invensys to reduce its level of debt.
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 said to be 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.