McDermott International, Inc. (NYSE: MDR) (“McDermott”) today
announced that its Board of Directors has approved the spin-off of
its power generation systems and government operations segments
through the distribution of shares of The Babcock & Wilcox
Company (“B&W”), to holders of McDermott common stock.
The distribution of B&W common stock is expected to occur on
July 30, 2010, with McDermott stockholders receiving one share of
B&W common stock for every two shares of McDermott common stock
held at the close of business on July 9, 2010. Fractional shares of
B&W common stock will not be distributed, and any fractional
share of B&W common stock otherwise issuable to a McDermott
stockholder will be sold in the open market on such stockholder’s
behalf, and such stockholder will receive a cash payment with
respect to such fractional share.
Following the distribution of the B&W common stock in the
spin-off, B&W will be a separate, publicly traded company, and
McDermott will not retain any ownership interest in B&W. The
shares of B&W common stock will be listed on the New York Stock
Exchange under the symbol “BWC.”
The completion of the distribution is subject to: the Securities
and Exchange Commission (“SEC”) having declared effective B&W’s
Registration Statement on Form 10, as amended (“Form 10”), and
other conditions described in the information statement included as
an exhibit to the Form 10, which B&W has filed with the SEC and
is available at the SEC’s website at www.sec.gov.
McDermott has received a private letter ruling from the Internal
Revenue Service to the effect that, based on certain facts,
assumptions, representations and undertakings set forth in the
ruling, for U.S. federal income tax purposes, the distribution of
B&W common stock and certain related transactions will not be
taxable to McDermott or U.S. holders of McDermott common stock,
except in respect of cash received in lieu of fractional share
interests, which generally will be taxable to such holders as
capital gain.
“We have made great progress over the past six months, and I am
very pleased to now be reaching this important point in the process
of completing the B&W spin-off,” said John A. Fees, Chief
Executive Officer of McDermott. “As we outlined in December, we
believe the spin-off will provide important benefits to our
stockholders. We believe that as separate, independent, publicly
traded entities, B&W and the remaining McDermott will benefit
from enhanced management focus, more efficient capital allocation
and greater operational and strategic flexibility. We also believe
that the spin-off will help preserve B&W’s ability to contract
with the U.S. Government. I am proud of the shared accomplishments
of McDermott and B&W as a combined group of companies, and I
look forward to their future, independent successes as they each
continue to remain focused on the best, long-term interests of
their customers and stockholders. I also want to extend my sincere
appreciation to all of our employees whose tireless efforts and
commitment have made the spin-off possible.”
No action is required by McDermott stockholders in order to
receive shares of B&W common stock in the spin-off
distribution, and McDermott stockholders should retain their
McDermott stock certificates. McDermott stockholders entitled to
receive the dividend will receive a book-entry account statement
reflecting their ownership of shares of B&W common stock or
their brokerage account will be credited for the shares.
McDermott expects that a “when-issued” public market for B&W
common stock will commence shortly after the July 9, 2010 record
date and will continue through the distribution date. McDermott
also anticipates that “regular-way” trading of B&W’s common
stock will begin on August 2, 2010, the first trading day following
the distribution date.
In addition, shortly after the July 9, 2010 record date, it is
expected that shares of McDermott common stock will begin trading
two ways – either with or without the distribution of the shares of
B&W. McDermott stockholders who sell their shares of McDermott
common stock in the “regular-way” market (i.e., the normal trading
market on the NYSE under the symbol “MDR”) after the record date
and on or prior to the distribution date will be selling their
right to receive shares of B&W common stock in connection with
the spin-off. It is anticipated that shares of McDermott common
stock will also trade “ex-distribution” (that is, without the right
to receive the B&W distribution) during that period under the
symbol “MDRwi.” Investors are encouraged to consult with their
financial advisors regarding the specific implications of buying or
selling shares of McDermott common stock on or before the
distribution date.
McDermott expects to mail the information statement to all
stockholders entitled to receive the distribution of shares of
B&W common stock on or about July 21, 2010. The information
statement will describe B&W, the various risks involved,
including the risks of holding B&W common stock, and other
details of the transaction, including additional details regarding
the spin-off.
About The Babcock & Wilcox Company
B&W is a leading technology innovator in power generation
and a specialty manufacturer of nuclear components with a rich
legacy spanning over 140 years. B&W designs, engineers,
manufactures, and constructs power generation systems, primarily
for large utility and industrial customers, as well as related
aftermarket parts, services and environmental control systems. For
its largest customer, the U.S. Government, B&W supplies nuclear
components for defense programs and manages and operates nuclear
facilities and environmental management sites. B&W has
locations worldwide and employs over 13,000 people, not including
approximately 10,000 joint venture employees.
About McDermott (following the spin-off of B&W)
McDermott is an engineering and construction company, and will
be focused on the offshore upstream oil and gas market. McDermott
provides front-end design and detailed engineering, construction
and installation of offshore production facilities, pipelines and
subsea systems. McDermott’s customers include national and major
oil and gas companies worldwide, and it has a significant presence
in the Americas, Asia-Pacific, Caspian and Middle East markets.
McDermott employs approximately 16,000 people worldwide.
Forward Looking Statements
In accordance with the Safe Harbor provisions of the Private
Securities Litigation Reform Act of 1995, as amended, McDermott
cautions that statements in this press release, which are
forward-looking and provide other than historical information,
involve risks and uncertainties that may impact McDermott’s actual
results of operations or may otherwise be material. These
forward-looking statements include statements about the completion
of the spin-off, the expected distribution date, the listing of the
shares of B&W common stock on the NYSE, the tax-free nature of
the spin-off distribution and certain related transactions, the
anticipated benefits of the spin-off, the future successes of the
two companies, the anticipated dates for B&W common stock to
begin trading on a “when-issued” basis and on a “regular-way” basis
and for McDermott stock to begin trading on an “ex-distribution”
basis and the expected mailing date for the information statement.
Although we believe that the expectations reflected in those
forward-looking statements are reasonable, we can give no assurance
that those expectations will prove to have been correct. Those
statements are made by using various underlying assumptions and are
subject to numerous uncertainties and risks, including that the two
companies may be unable to realize the anticipated benefits of the
spin-off, the spin-off distribution may not be completed as
anticipated or at all and delays or other difficulties in
completing the distribution may be experienced. If one or more of
these risks materialize, or if underlying assumptions prove
incorrect, actual results may vary materially from those expected,
projected or implied. For a more complete discussion of these and
other risk factors, please see McDermott’s annual and quarterly
filings with the SEC, including its annual report on Form 10-K and
quarterly reports on Form 10-Q, and the Form 10. This press release
reflects management’s views as of July 2, 2010. Except to the
extent required by applicable law, McDermott undertakes no
obligation to update or revise any forward-looking statement.
McDermott (NYSE:MDR)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
McDermott (NYSE:MDR)
Historical Stock Chart
Von Jul 2023 bis Jul 2024