Weir Group sells oil & gas unit to Caterpillar for £314m
Weir Group has sold its oil & gas division to Caterpillar $405m (£314m) in cash as the engineering firm moves to focus on the mining sector.
The company on Monday said net proceeds would reduce its debt and the deal would create a $70m US cash tax benefit to be realised over the medium term. Completion was expected by the end of 2020, assuming normal regulatory clearances.
A slump in the oil price during the coronavirus pandemic has hit the sector hard, with exploration budgets cut
“We are pleased to have reached this agreement that delivers a great home for the oil and gas division and maximises value for our stakeholders,” chief executive Jon Stanton said.
“Alongside the previous sale of the flow control division and the acquisition of ESCO, it is a major milestone in transforming the group into a focused, premium mining technology business.”