MRC Global sells OCTG business
MRC Global recently announced it has entered into a definitive agreement to sell its U.S. OCTG business to Sooner Pipe, a subsidiary of Marubeni-Itochu Tubulars America, for $48 million, subject to certain adjustments. MRC Global’s U.S. OCTG sales were about $305 million in 2015. The transaction was expected to close in the first quarter of 2016, subject to customary closing conditions.
“The divestiture of our OCTG product line is the culmination of our strategy to reduce our exposure to upstream drilling volatility and to focus on growing our higher-margin product lines, particularly our valve, valve automation and instrumentation business,” MRC Global Chairman, President and CEO Andrew Lane said. “We remain committed to our line pipe business as it has applications across each of the upstream, midstream and downstream end markets. This transaction benefits our U.S. OCTG customers, suppliers and employees by placing the business with the leading OCTG distributor and service provider. We will work with Sooner to ensure a smooth transition of business.”
Also, MRC Global Australia PTY, a subsidiary of MRC Global, recently announced it has signed a five-year agreement with Shell Australia to provide MRO requirements for its Prelude floating liquefied natural gas project.
MRC Global will consolidate more than 197 suppliers into one supply contract covering the procurement and inventory of all pipes, valves, fittings, control valves, gaskets, hoses, studs, nuts, gaskets and spare parts. This includes the provision of full technical support, quality assurance, expediting and distribution solutions.
In other recent MRC Global news, the company’s Board of Directors named Rhys J. Best nonexecutive chairman effective as of its upcoming annual shareholders meeting on April 28. Lane will continue to serve as president and CEO and as a director, roles he’s held since 2008. The board also extended Lane’s employment agreement until May 2020.