AZZ, Inc. (AZZ) to Divest Nuclear Logistics Unit
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AZZ Inc. (NYSE: AZZ) announced that it has entered into an agreement to divest its Nuclear Logistics LLC ("NL") operating business unit to Westinghouse Electric Company. Terms of the transaction were not disclosed, and are subject to customary terms and conditions. The transaction is expected to close in the fall of 2016.
Tom Ferguson, Chief Executive Officer of AZZ, commented, "During the past 12 to 18 months we have conducted a strategic review to evaluate our assets and product portfolio to identify our core and non-core businesses. That review made it clear to us that the NL business is better suited as part of a company with a strong involvement in the nuclear industry. We are pleased to have reached an agreement where Westinghouse, a leader in the nuclear industry, will acquire these assets, which will seamlessly integrate into their existing operations, and will enable us at AZZ to drive growth as we increasingly focus on our core businesses. I am convinced that Westinghouse will be a great partner to the NL customer roster, as well as a good employer for NL's work force. We look forward to working with Westinghouse to ensure a smooth transition and continuity of service for NL's customers. This is a good deal for everyone involved; our customers, our employees and our shareholders."
Nuclear Logistics LLC is the largest third-party supplier of safety related equipment to the nuclear industry and has employees that are knowledgeable in areas such as nuclear qualification and testing, which are well in line with the nuclear parts and supply business of Westinghouse.
"This transaction better positions AZZ to continue to expand its market share in the galvanizing and energy segments," continued Mr. Ferguson. "We will continue to leverage our expertise as a solutions leader in protecting metal and electrical systems that drive infrastructure and that grow our businesses profitably. We could potentially record a one-time, non-cash charge related to the sale, which would be moderately offset by the realization of deal-related tax benefits to the current fiscal year. Due to the uncertainty of the charge and the timing of the potential sale, we are suspending our previously issued EPS and revenue guidance for our fiscal year 2017, and will discuss this further at our upcoming review of our second quarter fiscal year 2017 scheduled for Wednesday, October 5th," concluded Mr. Ferguson.
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