AZZ Inc. issued the following announcement on Feb. 11.
AZZ Inc. (NYSE:AZZ), a global provider of metal coating services, welding solutions, specialty electrical equipment and highly engineered services, today announced that it has entered into an agreement to divest its Nuclear Logistics LLC ("NLI") operating business unit to Paragon Energy Solutions, LLC ("Paragon"). Terms of the transaction were not disclosed, and are subject to customary closing terms and conditions, including obtaining consents on certain governmental contracts. The transaction is expected to close by the end of the fourth quarter of AZZ's fiscal year 2020. Upon closing of the transaction, the Company expects to record a one-time, non-cash charge related to the divestiture of NLI which would be moderately offset by the realization of deal-related tax benefits to the current fiscal year 2020.
Tom Ferguson, Chief Executive Officer of AZZ, commented, "We are pleased to have reached an agreement to divest the NLI business with Paragon. I am convinced that Paragon will be a great partner to the NLI customer base, as well as a good employer for NLI's work force. We were successful in improving NLI operational performance, but based upon a strategic review of our assets and product portfolio, we believe the divestment of NLI and redeployment of capital into our metal coatings business segment creates greater growth opportunities for AZZ. We will work with the Paragon team to affect a seamless transition and to ensure NLI's customers receive the industry-leading service they deserve."
"I anticipate our fiscal year 2020 operating results will remain within the range of the previously issued revenue and earnings guidance, without the effects of the potential non-cash charge and related tax benefits. Additionally, we are maintaining our recently issued guidance for fiscal year 2021 and will provide an update, if necessary," concluded Mr. Ferguson.
About Paragon
For over 20 years Paragon has provided an unmatched commitment to the nuclear industry's most difficult challenges with customized solutions. Dedicated to quality, safety, and reliability, Paragon prides itself on delivering premium products and services including repair of I&C equipment, reverse engineered products, solving obsolescence, commercial grade dedication / qualification, just-in-time inventory, and innovative supply chain solutions. Paragon is committed to the nuclear industry and providing support to nuclear energy facilities worldwide.
About AZZ Inc.
AZZ Inc. is a global provider of metal coating solutions, welding solutions, specialty electrical equipment and highly engineered services to the power generation, transmission, distribution and industrial markets. AZZ Metal Coatings is a leading provider of metal finishing solutions for corrosion protection, including hot dip galvanizing to the North American steel fabrication industry. AZZ Energy is dedicated to delivering safe and reliable transmission of power from generation sources to end customers, and automated weld overlay solutions for corrosion and erosion mitigation to critical infrastructure in the energy markets worldwide.
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