Westport Fuel Systems Inc. has completed the sale of its compressed natural gas (CNG) compressor business to Snam S.p.A., a major European gas utility company, for total proceeds of EUR 12.3 million, net of a EUR 500,000 holdback to be released upon fulfillment of an independent audit process, which will be completed within 30 business days.
This divestiture was initially announced by Westport Fuel Systems on May 17. According to the Vancouver-based company, the deal was consistent with its strategy to streamline its business and product lines and focus on supplying alternative fuel vehicle components and systems to the transportation industry.
“The closing of this transaction marks another achievement in our portfolio rationalization, a strategic initiative we started two years ago following the merger with Fuel Systems Solutions to capture synergies, drive efficiencies and strengthen our balance sheet,” states Nancy Gougarty, CEO of Westport Fuel Systems. “With a stronger balance sheet, a more streamlined business and improving operational results, we believe we can build on our market-leading position in our core markets, which should drive long-term value for the company and our shareholders.”
In other global deals, Westport recently signed a development and supply agreement with India-based automaker Tata Motors Ltd., a memorandum of understanding with China-based Weichai Power and a $20 million loan agreement with Export Development Canada. The company was established in mid-2016 as a merger between Westport Innovations Inc. and Fuel Systems Solutions Inc.