CHARLOTTE: EnPro Industries Inc. announced that a definitive agreement to sell all assets related to the STEMCO Motor Wheel brake drum and Crewson brake adjuster brands (collectively the “business”), has been entered into with Hendrickson USA, LLC.
“After announcing the exit of STEMCO’s Motor Wheel brake drum and Crewson brake adjuster brands on June 25th, we were pleased to receive an offer from Hendrickson to purchase the assets and to continue operating the business. This transaction represents a positive outcome for all stakeholders as it preserves the jobs of our workforce and mitigates customer disruptions, while providing EnPro’s shareholders a fair valuation for the assets of the business,” said Marvin Riley, President and Chief Executive Officer.
“On behalf of the entire EnPro organization, I want to express our great appreciation for the many contributions that our colleagues at STEMCO’s Motor Wheel and Crewson0 businesses have made to EnPro,” added Mr. Riley.
“The sale of this business supports our journey of reshaping our portfolio towards businesses with compelling margins, leading technology, and high cash flow return on investment in markets with favorable secular tailwinds; maintaining a balanced approach to capital allocation; increasing aftermarket exposure and recurring revenue opportunities; and leveraging the EnPro Operating System for continuous improvement to increase margins and cash flow return on investment,” said Mr. Riley.
During the second quarter, in connection with the decision to exit this business, EnPro recorded related restructuring and impairment charges of $11.1 million. Upon the expected completion of the sale during the third quarter, EnPro anticipates reversing $3.7 million of the cash restructuring charges recorded in the second quarter and recording a loss on sale of the business of approximately $4.4 million, for a pretax loss in the third quarter of approximately $0.7 million.
EnPro Industries, Inc. is a niche provider of precision components, solutions, and services with a well-diversified customer base.