Weir to Sell Glasgow?
Posted: Monday 19th February 2007
The Weir Group PLC (“the Group”) is in advanced stages of discussions with Sulzer AG in connection with the sale of the Glasgow based business unit of Weir Pumps for an expected consideration of £48 million.
The unit manufactures custom-engineered pumps for the upstream oil and power generation markets. Under the terms being discussed, all 596 employees will transfer to Sulzer on their existing terms. Sulzer will retain a significant engineering, design and technical sales presence in addition to a spares and aftermarket manufacturing facility in Glasgow.
However, significant operational redundancies related to the original equipment business are to be anticipated in the run up to the previously announced closure of the Cathcart facility in 2009. Appropriate retention incentives and redundancy packages will be offered to affected employees.
Weir Services Division does not form part of the discussions and the 660 Services Division employees in the UK, including 116 based in Glasgow, will remain part of the Group. The head office of The Weir Group PLC continues to be situated in Glasgow.
Mark Selway, Chief Executive of The Weir Group PLC, commented:
“Weir Pumps business represents 8% of Weir Group revenue and a lower percentage of annual profits. The business competes in the global marketplace against manufacturers who have an established presence in low cost countries. We have been evaluating all options regarding the future of the business and have concluded that, if the right terms can be agreed, Sulzer will be better placed to realise the potential of the engineered pumps business and that this sale will represent the best way forward for the business and shareholders alike.”
A further announcement will be made in due course.
