McDermott International, Inc. (MDR) said it intends to separate its operating subsidiaries, The Babcock & Wilcox Co. and J. Ray McDermott, S.A., into two independent, publicly traded companies. The separation is anticipated to be effected through a spin-off of Babcock & Wilcox Co., a transaction that is intended to be tax-free to McDermott shareholders.
McDermott believes that following the separation, each resulting company will have substantial liquidity, ample access to capital and a strong balance sheet.
Following completion of the separation, McDermott intends to be renamed J. Ray McDermott, S.A., and shareholders will own 100% of two separate companies: Babcock & Wilcox Co. and J. Ray McDermott. The transaction is expected to be completed in nine to twelve months.
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