Fernweh Group to Acquire Majority Stake of AZZ Segment
The transaction is expected to close before the end of 2022, whereby Fernweh will own 60% of the AIS JV and AZZ will own 40%.
AZZ Inc. (Fort Worth, Texas) and Fernweh Group (Bay Area, California) jointly announce they have entered into a definitive agreement where AZZ will contribute its AZZ Infrastructure Solutions Segment (AIS) to AIS Investment Holdings (AIS JV), and sell a 60% interest in the AIS JV to Fernweh at an implied enterprise value of AIS of $300 million. Under the terms of the transaction, the AIS JV will be governed by a board with three representatives from Fernweh and two representatives from AZZ. Following the close of the transaction, Fernweh will own 60% of the AIS JV and AZZ will own 40%. The transaction is expected to close before the end of 2022, subject to requisite governmental approvals and other closing conditions and approvals.
AIS is a leading provider of specialized products and solutions designed to support industrial and electrical applications. AIS’ product offerings include custom switchgear, electrical enclosures, medium and high voltage bus ducts and explosion proof and hazardous duty lighting. In addition, AIS focuses on extension of life cycle for the power generation, refining and industrial infrastructure markets, through automated weld overlay solutions for corrosion and erosion mitigation. The AIS business has approximately 1,323 employees and operates through a global network of 20 located manufacturing facilities.
In conjunction with the divesture of a majority stake in AIS and in accordance with generally accepted accounting principles, the company is required to measure AIS at the lower of its carrying amount or fair value less costs to sell. The company will reportedly complete this assessment in the second quarter of fiscal year 2023. The result of this assessment will be recorded as part of discontinued operations in the company’s financial statements, and on a future basis, it is expected the continued investment in AIS will be deconsolidated from the company's financial statements and accounted for under equity method of accounting.
