First Reserve, an international private equity investment firm focused on energy, has announced an agreement to purchase Weir Flow Control (WFC) from The Weir Group (Weir).
First Reserve is expected to close the transaction in the second quarter of 2019, depending on certain antitrust approvals and other customary closing conditions.
WFC is an engineered valves and pumps designer, manufacturer and aftermarket services provider.
First Reserve managing directors Jeff Quake and Neil Hartley said: “First Reserve has deep historical experience creating value for our investors in the flow control space, and we are pleased to partner with Weir in this carve-out transaction.
“In our view, Weir Flow Control represents an attractive growth platform in a fragmented sector with internationally recognized brands driven by recurring high-margin aftermarket parts and services which have proven to be resilient through multiple economic environments.
The company said that WFC consists of global brands in niche applications supporting safe, reliable and efficient energy and industrial processes worldwide.
The brands include the manufacturing of pressure relief, control and engineered isolation valves and centrifugal pumps for applications in the downstream, midstream, utility and industrial sectors as well as related aftermarket parts and services.
WFC CEO David Paradis said: “Weir Flow Control provides high-quality products and services, critical to the safe operations of our clients in the downstream, midstream, utility, and industrial end markets. As an organisation, we enjoy strong long-term relationships with our customers and pride ourselves on innovation that places the customer first.
“We thank Weir Group for their support over the years and are excited to partner with First Reserve in this next chapter for our company. We look forward to benefiting from First Reserve’s experience in the flow control sector as we seek to grow our global business.”
In November 2018, First Reserve agreed to purchase Dominion Energy’s stake of 50% in Blue Racer Midstream for a total amount of up to $1.5bn.
Under the terms of the agreement, the company was expected to pay Dominion Energy $1.2bn in cash and up to $300m in the form of earn-out payments based on the performance of the US-based Blue Racer Midstream.