The Babcock & Wilcox Company (or the “Company”) (NYSE:BWC) announced today that its Board of Directors has formally approved the spin-off of the Power Generation business creating a new public company. The Power Generation business will be named Babcock & Wilcox Enterprises, Inc. (“New B&W”), and operate as Babcock & Wilcox. It will be headquartered in Charlotte, N.C.
The remaining company will change its name to BWX Technologies, Inc. (“BWXT”) on the date of the spin-off and will be headquartered in Lynchburg, Va. In approving this transaction, the Board of Directors believes these two companies will benefit from independent management teams, strategic autonomy, and financial flexibility to create significant long-term shareholder value.
“Since announcing in November 2014 the board’s decision to pursue this spin-off, we have been working to prepare for a successful launch of these two companies,” said E. James Ferland, President and Chief Executive Officer of the Company. “With strong recent performance in both businesses, there is significant momentum for the future growth and success we anticipate from both companies in their separate and important markets.”
As a result of the spin-off, Company stockholders can expect to receive as a dividend one share of New B&W common stock for every two shares of the Company’s common stock held as of 5:00 p.m. EST on June 18, 2015, the record date. The distribution of New B&W shares is expected to occur on June 30, 2015 and is expected to be tax-free.