LONDON--(BUSINESS WIRE)--Global Power Group (GPG)
This morning, the Company signed an agreement to sell its core boiler business to Sumitomo Heavy Industries, Ltd for £137m. The proceeds for this business are consistent with the £180m book value for the whole of GPG as at June 2016.
The core boiler business represented £180m of the revenues and £9m of the trading profit within the GPG full year 2015 results. Gross assets at December 2015 were £243m. In provisional 2016 full year numbers the core boiler business contributed revenues of £200m and trading profit of £25m.
The sale is conditional on customary regulatory approvals in certain jurisdictions and is expected to be completed during the second quarter.
The core boiler business designs, manufactures and installs circulating fluidised bed boilers which burn a variety of fuels in an efficient and environmentally friendly manner and are employed in power generation plants.
The balance of GPG’s steam generator businesses, the heat recovery steam generator and industrial boilers businesses are expected to be sold during 2017, while the North American aftermarket services business is being retained, and since the beginning of 2017 has been operating as part of Power & Process.
The Company sold Aquenta Consulting Pty Ltd., a specialist consultancy business based in Australia, to Jacobs Group (Australia) Pty Ltd for £21m in January. In provisional full year results for 2016, Aquenta contributed £4m of trading profit.
The Company sold its 85% interest in Petropower Energía Limitada to ENAP Refinerías S.A. for £40m in December 2016. Until being classified as an ‘asset held for sale’ in June 2016, Petropower was reported under GPG.
The Company received £30m of proceeds from the sale of its 23% interest in Incheon Bridge Co., Ltd. to Private Infrastructure Investment Korea Co. Ltd in December 2016. The transaction remains conditional upon South Korean government approval.
The Company signed an agreement to sell Amec Foster Wheeler Power S.r.l., which operates two wind farms in Italy, to Enel Green Power S.p.A. for £18 million in December 2016. This is expected to close in May 2017.
Collectively the infrastructure assets contributed £14m of trading profit to the provisional full year 2016 results.
The Board launched a process to sell the Company’s nuclear operations in December 2016, and a competitive process is now underway. The Company has received a high level of interest and expects indicative bids later this month. The process is expected to conclude in Q3.
In provisional full year results for 2016, the nuclear operations contributed revenue of £274m and trading profit of £16m.
In aggregate, the Board now expects to receive £246m of proceeds before the end of the second quarter, with additional proceeds from the nuclear assets expected to be received in the third quarter, and from the remaining GPG assets in the fourth quarter. The proceeds will be used to reduce net debt.
We continue to consider the right mix of investment and funding options which in aggregate will lead to an appropriate balance sheet and create a strong ongoing business. A further update will be given with the full year results and in the operational and strategy presentations at the capital markets event on 21st March 2017.
This announcement contains inside information, and has been approved by Alison Yapp, Chief General Counsel and Company Secretary.
Notes to editors:
Amec Foster Wheeler (www.amecfw.com) designs, delivers and maintains strategic and complex assets for its customers across the global energy and related sectors.
Employing around 36,000 people in more than 55 countries and with 2015 revenues of £5.5 billion, the company operates across the oil and gas industry – from production through to refining, processing and distribution of derivative products – and in the mining, power & process, pharma, environment and infrastructure markets.
Amec Foster Wheeler offers full life-cycle services to offshore and onshore oil and gas projects (conventional and unconventional, upstream, midstream and downstream) for greenfield, brownfield and asset support projects, plus leading refining technology.
Amec Foster Wheeler shares are publicly traded on the London Stock Exchange and its American Depositary Shares are traded on the New York Stock Exchange. Both trade under the ticker AMFW.
This announcement contains statements which constitute “forward-looking statements”. Forward-looking statements include any statements related to the timing, results and success of contracts, and are generally identified by words such as “believe,” “expect,” “anticipate,” “intend,” “estimate,” “will,” “may,” “continue,” “should” and other similar expressions. Forward-looking statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Amec Foster Wheeler, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking statements. Amec Foster Wheeler does not undertake to update any of the forward-looking statements after this date to conform such statements to actual results, to reflect the occurrence of anticipated results or otherwise.