(By Balaseshan) Shaw Group Inc. (NYSE:SHAW) said it has closed its divestiture of substantially all of its Energy & Chemicals business to Technip, effective Aug. 31, 2012.
Proceeds from the transaction were about $290 million in cash. The completion of this transaction also satisfies one of the conditions of the recently announced agreement for Chicago Bridge & Iron Co. (NYSE:CBI) to acquire Shaw.
Technip purchased Stone & Webster process technologies and associated oil and gas engineering capabilities from Shaw Group. A new business unit, Technip Stone & Webster Process Technology, will be developed within the Onshore/Offshore segment.
Technip paid cash consideration from existing cash resources, which will be subject to customary price adjustments.
As previously stated, there will be no material impact on Technip's 2012 full year revenues and operating income with unchanged estimates in transaction and integration costs.
Looking forward, the acquired business should generate margins above those of Technip's Onshore/Offshore segment, while having a more robust and lower risk earnings profile.
SHAW is trading down 0.02% at $42.09 on Friday. The stock has been trading between $18.98 and $43.70 for the past 52 weeks.