The Shaw Group Inc. has entered into a definitive agreement to sell substantially all of the assets of Shaw Energy Delivery Services, Inc. (EDS) to Pike Electric, Inc.
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 Bernhard.
KeyBanc Capital Markets Inc. is acting as an exclusive financial advisor to The Shaw Group Inc. in this transaction.