McDermott International, Ltd has entered into an agreement to sell its CB&I storage business to a consortium of financial investors led by Mason Capital Management. The transaction, valued at $475 million before taxes and expenses, is expected to close in the fourth quarter of this year.
The sale follows a comprehensive marketing process that attracted multiple bids from prospective buyers. Proceeds from the transaction will be used to repay CB&I’s term loan, cash collateralise McDermott’s letters of credit, and reduce an existing McDermott term loan.
“The significant interest in our storage business reflects its long history of delivering world-class storage solutions and its promising future,” said Michael McKelvy, president and CEO of McDermott. “This is the best outcome for McDermott, CB&I, its customers, and its employees.”
CB&I, a global leader in designing and constructing storage facilities, tanks, and terminals, became part of McDermott in 2018. McDermott strengthened CB&I’s operations in 2023 by providing a dedicated capital structure to support the business.
“We are excited for the next chapter in our 130-year history,” stated Mark Butts, senior vice president of CB&I. “The consortium is composed of shareholders who understand and support our strategy.”
Mike Martino, managing member and principal of Mason Capital, expressed optimism about the acquisition. “We believe CB&I has significant potential as a standalone company, and we look forward to leveraging our experience to enhance its operations and drive long-term growth.”
Goldman Sachs & Co. LLC served as the exclusive financial advisor to McDermott, with legal counsel provided by Kirkland & Ellis LLP. Citi acted as exclusive financial advisor to Mason, with legal counsel from Cadwalader, Wickersham & Taft LLP.
For more information visit www.mcdermott-investors.com
