Scottish engineering company Weir Group has signed an agreement to sell its entire Oil & Gas division to US-based firm Caterpillar.
The deal is valued at a cash consideration of £314m ($405m).
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This news follows the announcement made in February that Weir would seek to maximise value from its Oil & Gas division as part of a strategic transformation.
The transaction includes more than 40 manufacturing and services locations of Weir Oil & Gas. It also includes about 2,000 employees.
Expected to be completed by the end of this year, the transaction is subject to review by various regulatory authorities and other customary closing conditions.
Weir Group CEO Jon Stanton said: “We are pleased to have reached this agreement that delivers a great home for the Oil & Gas division and maximises value for our stakeholders.
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By GlobalData“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.”
Weir Oil & Gas is a producer of full line of pumps, flow iron, consumable parts, wellhead as well as pressure control products.
Caterpillar’s Oil & Gas and Marine Division vice-president Joe Creed said: “Combining Weir Oil & Gas’s established pressure pumping and pressure control portfolio with Cat’s engines and transmissions enables us to create additional value for customers.
“This acquisition will expand our offerings to one of the broadest product lines in the well service industry.”
Through the divestment, Weir Group intends to strengthen its balance sheet to support investment in future growth opportunities.
