Shaw to Divest Transmission and Distribution Business

June 18, 2008 6:32 PM EDT

BATON ROUGE, La.--(BUSINESS WIRE)--

The Shaw Group Inc. (NYSE: SGR) announced today that it has entered into a definitive agreement to sell substantially all of the assets of Shaw Energy Delivery Services, Inc. (EDS) to Pike Electric, Inc., a wholly owned subsidiary of Pike Electric Corporation (NYSE: PEC).

EDS, a division of Shaw's Power Group, is a provider of design, engineering, procurement, construction and maintenance services for electrical transmission and distribution systems throughout North America.

"While the transmission and distribution market has become non-strategic for Shaw, we are pleased that Pike Electric will acquire EDS, which will enable them to offer best-in-class substation engineering and construction services. Pike Electric is well-respected in the power industry, and it will continue to offer transmission and distribution services that complement Shaw's core business," said J.M. Bernhard Jr., Shaw's chairman, president and chief executive officer.

Under the terms of the agreement, Pike Electric will acquire substantially all of the assets and assume a majority of the liabilities of EDS for approximately $24 million in cash, subject to a working capital adjustment. The transaction is expected to be completed in Shaw's fourth quarter fiscal year 2008 and is subject to customary closing conditions. Shaw expects no material impact to its consolidated financial results as a result of the transaction.

"With this divestiture, Shaw's Power Group will better focus on its core service offerings as the premier provider of engineering, procurement, construction and maintenance services for power generating facilities," added Mr. Bernhard.

KeyBanc Capital Markets Inc. is acting as an exclusive financial advisor to The Shaw Group Inc. in this transaction.

The Shaw Group Inc. is a leading global provider of technology, engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation and facilities management services for government and private sector clients in the energy, chemicals, environmental, infrastructure and emergency response markets. A Fortune 500 company with fiscal 2008 revenues expected to exceed $7 billion, Shaw is headquartered in Baton Rouge, La., and employs approximately 27,000 people at its offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region. For further information, please visit Shaw's Web site at www.shawgrp.com.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained herein that are not historical facts (including without limitation statements to the effect that the Company or its management "believes," "expects," "anticipates," "plans" or other similar expressions) and statements related to revenues, earnings, backlog or other financial information or results are forward-looking statements based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. These forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions and are subject to change based upon various factors. Should one or more of such risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. A description of some of the risks and uncertainties that could cause actual results to differ materially from such forward-looking statements can be found in the Company's reports and registration statements filed with the Securities and Exchange Commission, including its Form 10-K and Form 10-Q reports, and on the Company's Web site under the heading "Forward-Looking Statements." These documents are also available from the Securities and Exchange Commission or from the Investor Relations department of Shaw. For more information on the company and announcements it makes from time to time on a regional basis, visit our Web site at www.shawgrp.com.

Source: The Shaw Group Inc.

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