ABB selling part of its oil, gas and petrochemical division

Zurich, Switzerland - ABB recently agreed to sell the upstream part of its oil, gas and petrochemicals division to a newly incorporated company formed by a private equity investors’ consortium, including Candover Partners Ltd, 3i and J.P. Morgan Partners. ABB expects to record a small capital gain on the initial sale price of $925 million. The agreement also includes a potential deferred consideration of an additional amount of up to $50 million.

“This divestment agreement marks a further, decisive step to increase the focus on our core businesses and to finalize our divestment program,” says Peter Voser, ABB’s chief financial officer.

A preliminary agreement on the deal was announced in late October 2003. This divestiture is subject to the customary regulatory approvals and closing conditions, and also depends on the satisfactory completion and disposition of some compliance matters presently being reviewed. The closing is expected in mid-2004.

ABB is selling its U.S.-based Vetco Gray unit and its ABB Offshore Systems business, headquartered in Norway. These upstream businesses are active in more than 30 countries and employ some 7,500 people, mostly in Brazil, Canada, Norway, Singapore, the U.K. and the U.S. The two businesses had total revenues of $1.7 billion in 2002.

Not included in the current latest sale is ABB Lummus Global, which is mainly a downstream business. ABB adds that it’s negotiating with several other parties that may purchase Lummus Global. The company also expects to complete that sale in 2004.

Control Engineering Daily News Desk
Jim Montague, news editor
jmontague@reedbusiness.com

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