BATON ROUGE, La. (AP) -- Engineering and construction company Shaw Group Inc. said Monday it will sell almost all of its energy and chemicals business to the French company Technip for about $300 million.
CEO J.M. Bernhard said the sale is part of Shaw Group's strategy to focus on its core businesses. Shaw said the cash deal is expected to close in the fourth quarter of its fiscal year, which ends in August.
The company said it expects to book a net gain of about $10 million after tax from the sale.
As a result of the sale, Shaw Group boosted its full-year earnings outlook. The company said it now expects to earn between $2.20 and $2.30 per share during the year, up from its previous estimate between $2.05 per share and $2.15 per share.
Analysts were expecting $2.10 per share, according to a survey by FactSet.
Shaw said it will keep its energy and chemicals group employees at its Baton Rouge office, which will be integrated into its plant services division. The company will also keep Shaw Consulting International Inc., which will be folded into Shaw's environmental and infrastructure group.
Shaw will keep its Toronto-based operations and is reviewing options regarding future plans for that office.
"Shaw will continue to focus our efforts on growing our leadership positions in our core business lines and ensuring excellence and consistency across all operations," Bernhard said in a statement.
UBS Investment Bank is the exclusive financial adviser on the deal, while Vinson & Elkins LLP is legal adviser to Shaw.
Shares rose 83 cents, or 3 percent, to $28.40 in aftermarket trading following the announcement. The stock had risen 11 cents to close at $27.57 during normal trading.
