MRC Global announced that its subsidiary, MRC Global (Canada) ULC, has entered into a definitive agreement to sell its Canada operations to Emco Corporation.
Rob Saltiel, MRC Global President & CEO stated, “This divestiture will reposition our strategic focus and future capital investment decisions on our core geographies and product offerings that provide the strongest growth and profit potential. The sale of our Canada business is expected to be accretive to our total company adjusted gross margins and adjusted EBITDA margins.
“I would like to express my appreciation to our Canada team members who have consistently provided exceptional value to our customers. We believe we have found the right home for the Canada business and that Emco Corporation is well equipped to maintain success for our employees and customers into the future,” Mr. Saltiel added.
As a result of the expected sale, a pre-tax, non-cash loss on discontinued operations of approximately US $25 million is expected to be recorded in the fourth quarter of 2024. The sale is anticipated to close in the first half of 2025 following customary closing conditions and required Canadian regulatory approval. The company plans to use the proceeds for reduction of debt.
Canadian Imperial Bank of Commerce (CIBC) acted as financial advisor to MRC Global. Norton Rose Fulbright acted as legal counsel to MRC Global; and McCarthy Tétrault acted as legal advisor to Emco.