Flowserve Corporation, a leading provider of flow control products and services for the global infrastructure markets, announced today that the French Ministry of Economy, as part of its Foreign Direct Investment review process, has rejected Flowserve’s acquisition of Velan Inc.
“We are obviously disappointed with the French government’s decision,” said Scott Rowe, Flowserve President and Chief Executive Officer. “We do not believe the decision aligns with the French government’s stated goal of encouraging foreign investment into France’s economy. Throughout this process, Flowserve worked diligently and proactively to address all of the concerns that were raised by the French government. We were optimistic about the acquisition of Velan and the numerous benefits this would provide for both companies and their stakeholders. We sincerely appreciate the efforts of our Flowserve associates and Velan team members who worked so tirelessly on the transaction. We remain excited about the future of Flowserve and will continue to aggressively pursue our 3D strategy.”
Flowserve and Velan previously extended the outside date of the arrangement agreement made as of February 9, 2023, among Velan Canada and Flowserve US, as amended to October 7, 2023. With the latest development regarding the French regulatory denial, Flowserve does not intend to make any further extensions to the outside date and intends to terminate the arrangement agreement following the occurrence of the outside date. According to the terms of the arrangement agreement, no termination fee will be payable by either party.