CECO Environmental Sells Fluid Handling Business to May River
CECO Environmental Completes Fluid Handling Business Sale
In a significant development, CECO Environmental Corp. (Nasdaq: CECO), a prominent diversified industrial company known for its environmentally focused solutions, has successfully divested its Fluid Handling business, also referred to as its Global Pump Solutions (GPS) division. This transaction was concluded on March 31, and CECO is poised to leverage the proceeds for strategic growth.
Transaction Details and Future Growth Plans
The deal, valued at approximately $110 million, was finalized in cash at the closing. This capital will not only aid in reducing outstanding debt but will also provide the resources necessary for future investments aimed at enhancing growth opportunities. CECO is redirecting its focus towards expanding its portfolio in energy and industrial markets, capitalizing on higher growth potential.
The GPS Business Overview
CECO's GPS division is recognized for its niche leadership in industrial metallic, fiberglass, and thermoplastic centrifugal pump brands, which include Dean, Fybroc, and Sethco. Acquired back in 2013, these brands have been instrumental in addressing over 1,500 customers across the globe. The GPS business operates from key locations in Indianapolis and Telford, ensuring a strong service framework.
CEO's Perspective on the Divestiture
CECO's Chief Executive Officer, Todd Gleason, expressed satisfaction with the completion of the transaction, noting it allows for a more streamlined alignment of CECO’s diverse portfolio focused on environmentally friendly solutions. Gleason further emphasized that this divestiture is instrumental in creating additional investment capacity for further business expansion in the fields of Industrial Air, Industrial Water, and the ongoing Energy Transition.
Advisors Involved in the Transaction
For this transaction, CECO enlisted the expertise of EC M&A as the primary financial advisor, while Koley Jessen provided legal counsel. On the other side, May River Capital had the legal and financial backing of Paul Hastings and TD Securities.
About CECO Environmental
Founded in 1966, CECO Environmental is a leader in providing environmentally focused industrial solutions, catering to a diverse array of markets globally. The company operates through its two main segments: Engineered Systems and Industrial Process Solutions. CECO’s innovative technologies aim to enhance air quality and optimize the energy value chain across various industries, including power generation, petrochemical processing, and battery production.
A Focus on Industry-Relevant Solutions
CECO’s commitment to delivering custom solutions spans a multitude of applications, ensuring cleaner and safer outcomes. From improving air quality to efficient wastewater treatments, CECO Environmental continues to be at the forefront of industrial innovation, supporting its clients to achieve sustainable operational efficiencies.
About May River Capital
May River Capital, located in Chicago, focuses on investing in the growth of lower middle-market industrial ventures. The firm specializes in advanced manufacturing, engineered products, and value-added distribution services, aligning perfectly with CECO’s growth philosophy.
Frequently Asked Questions
1. What prompted CECO Environmental to sell its Fluid Handling business?
CECO Environmental decided to divest its Fluid Handling business to streamline operations and focus on growing its portfolio in sectors with high growth potential.
2. How much was the Fluid Handling business sold for?
The Fluid Handling business was sold for approximately $110 million in cash at closing.
3. Who were the advisors for this transaction?
EC M&A and Koley Jessen acted as financial and legal advisors for CECO, while May River Capital was advised by Paul Hastings and TD Securities.
4. How does this divestiture align with CECO's future plans?
This divestiture creates additional capacity for CECO to invest in growth opportunities within the Industrial Air, Industrial Water, and Energy Transition markets.
5. What sectors does CECO Environmental target with its solutions?
CECO Environmental focuses on various sectors, including power generation, petrochemicals, battery production, and industrial water treatment.
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