McDermott receives ‘unsolicited approaches’ for Lummus Technology unit

US-based engineering services firm McDermott International has announced plans to explore ‘strategic alternatives’ for its Lummus Technology unit.

The recent announcement was made after receiving ‘unsolicited approaches’ to purchase all or a portion of the business, valuing it at $2.5bn.

The company said that it is considering the sale of its Lummus Technology business based on these approaches.

Lummus is a licensor of proprietary petrochemicals, refining, gasification and gas processing technologies. It also provides proprietary catalysts and other engineering services.

McDermott president and CEO David Dickson said: “Lummus is an excellent business, with incredibly impressive employees, that has earned a reputation for expertise, innovation and reliability in the refining and petrochemical industries.”

According to McDermott, the Lummus Technology business provides diversified technology portfolios to the hydrocarbon processing sector.

“The process of exploring strategic alternatives is part of our ongoing efforts intended to improve McDermott’s capital structure, and we plan to use the proceeds from any transaction involving Lummus Technology to strengthen our balance sheet.

“While Lummus is an important business within McDermott, we have decided to undertake a process to fully realise its strategic and financial value.”

Last October, McDermott announced integration processes to sell the remaining portion of its US pipe fabrication business. The company noted that the sale of its industrial storage tank business is currently underway.

In July, McDermott was awarded a contract to deliver front-end engineering design (FFED) services at the Sohar LNG Bunkering Project in Oman.