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(Sharecast News) - Goodwin said on Wednesday it has agreed to sell a substantial part of its mechanical engineering division to US private equity firm Cerberus Capital Management for up to £1.1bn.
The business includes Goodwin Steel Castings, Goodwin International, Noreva, Easat Group and the pumps division, and the deal is expected to complete in the first quarter of next year. The transaction excludes the refractory engineering division and technological division - made up of Internet Central and Duvelco - which will remain part of the group following completion.
Goodwin said the transaction represents "a compelling opportunity to unlock significant shareholder value while creating a more focused group with a strong balance sheet and enhanced capacity to invest in its remaining businesses".
The company also said it plans to pay a "significant" proportion of the net cash sale proceeds to its shareholders.
Chairman Timothy J. W. Goodwin, said: "Today's announcement represents a significant milestone in the history of Goodwin as we reposition our business and deliver significant value for our shareholders.
"The board would like to express its gratitude to all employees across GSC, GI, Noreva, Easat and Pumps for their dedication, professionalism and contribution over many years. Their commitment has created businesses with strong reputations, talented teams and excellent customer relationships which are well positioned for future growth with the support of Cerberus, an experienced investor with a strong and relevant track record of supporting businesses across the defence and industrial sectors to deliver on their underlying potential.
"We are excited about the future of the businesses being transferred and confident that this is in the best of interests of not only shareholders, but wider stakeholders.
"As we look ahead, we are confident of continued success and growth in our remaining businesses and thank all our employees for their continued dedication."
At 1005 BST, the shares were down 5% at 14,660p.
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