Under the terms of the deal, McDermott expects to receive $475 million of proceeds before taxes and transaction expenses.
McDermott expects to complete the transaction in the fourth quarter of this year.
The transaction is the culmination of a “comprehensive” marketing process during which McDermott received multiple bids from prospective buyers, it said.
Pursuant to the terms of McDermott’s credit agreement, proceeds from the sale will be used to repay CB&I’s existing term loan, cash collateralize certain McDermott letters of credit, and reduce an existing McDermott term loan.
Established in 1889 and headquartered in Texas, CB&I has more than 4,000 employees and 30 locations across North America, the Middle East, and Asia.
CB&I designs and builds storage facilities, tanks, and terminals, including LNG tanks and terminals.
CB&I’s projects include the Golden Pass LNG terminal, Marsa LNG, Plaquemines LNG, and others.
The company became part of McDermott in 2018 when the duo combined.
In 2023, McDermott completed actions to strengthen the storage business, including providing a dedicated capital structure.
“We look forward to the next chapter in our 130-year history,” said Mark Butts, senior VP of CB&I.
“The consortium represents a diverse group of shareholders who are familiar with our business and have long believed in and supported our strategy,” Butts said.
Mason said in a separate statement the consortium includes IES Holdings, Nut Tree Capital Management, 683 Capital Management, First Pacific Advisors, and other investors.
“We believe the company has significant potential as a standalone enterprise, and we look forward to leveraging our experience successfully investing in industrial and engineering-focused businesses to improve the company’s operations and support profitable, long-term growth,” Mike Martino, managing member and principal of Mason said.
