ENGlobal Corp. (ENG), a provider of energy-related engineering and automation services, Tuesday said it signed a definitive agreement to sell its Gulf Coast engineering and in-plant operations to Furmanite America, Inc. for about $21.5 million. The deal consists primarily of cash at closing and a $3.5 million promissory note issued with a parent company guarantee.
Furmanite America is a unit of specialty industrial services firm, Furmanite Corp. (FRM). The sale is expected to close within 60 days.
ENGlobal intends to use the net proceeds from the transaction to repay its outstanding debt. Pursuant to the agreement, about 900 employees from various operations of ENGlobal, will transition to Furmanite Technical Solutions, a newly formed business unit of Furmanite America, Inc.
ENGlobal's Gulf Coast engineering operations consist of its Beaumont, TX, Baton Rouge, LA, Lake Charles, LA, Deer Park, TX, and Freeport, TX offices, which primarily perform work for downstream clients across the region. The Company will retain its Engineering operations and the entirety of its Automation operations located in Houston, TX, Tulsa, OK, Mobile, AL, Denver, CO, and Chicago, IL, which primarily perform midstream and downstream related projects.
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