Mueller Water Products Signs Agreement to Divest U.S. Pipe

Mueller Water Products Inc. (NYSE:MWA) has signed a definitive purchase agreement to divest United States Pipe and Foundry Co. LLC and Fast Fabricators LLC (together “U.S. Pipe”) to an affiliate of Wynnchurch Capital Ltd., a Chicago-based private equity firm with offices in Dallas, Detroit and Toronto, the company recently announced.

Under the terms of the agreement, USP Holdings Inc., an affiliate of Wynnchurch, will acquire 100 percent of the equity interests in U.S. Pipe for $89.8 million in cash, subject to post-closing adjustments, and the agreement to reimburse Mueller Water Products for certain liabilities, currently estimated at $10.2 million. Mueller Water Products expects to use the proceeds from the divestiture to pay down debt and for general corporate purposes.

“The divestiture of U.S. Pipe enables us to focus on our higher-margin businesses and newer technology initiatives,” said Gregory E. Hyland, chairman, president and CEO of Mueller Water Products. “We believe that with this enhanced focus, the true potential of these initiatives will become more apparent to both our customers and stockholders. The ductile iron pipe business has been volatile, which has negatively impacted our financial performance and, we believe, masked the true value of our overall business. We have a solid platform for growth, and we believe the financial flexibility generated from the sale of U.S. Pipe, coupled with our strategic vision, will increase our ability to more profitably grow our business.”

// ** Advertisement ** //