James Fisher and Sons plc (“James Fisher”) has officially announced the divestiture of its subsidiary, RMSpumptools Limited (“RMS”), to ChampionX UK Limited, a subsidiary of ChampionX Corporation (“ChampionX”), for an enterprise value of £90 million. This transaction is pivotal for James Fisher, signifying a strategic refocus on its core sectors within the energy, defence, and marine transport markets. The deal, anticipated to close in the second half of 2024, hinges on the approval of James Fisher’s shareholders and the attainment of merger control clearance from the Saudi Arabian General Authority for Competition, among other conditions.

The disposal of RMS to ChampionX for £90 million represents approximately 7.4 times the estimated EBITDA of RMS for the year ending December 31, 2023. With the deduction of cash-like, debt-like items, and estimated transaction costs, James Fisher expects net proceeds of around £83 million in cash, subject to customary closing adjustments.

This significant inflow of capital will primarily serve to reduce James Fisher’s leverage, aiming to bring the Net Debt to EBITDA ratio within the targeted range of 1.0 to 1.5 times. This move is aligned with James Fisher’s strategy to streamline its portfolio by shedding non-core assets, thereby consolidating its focus on its foundational business sectors.

RMS, while recognized as a market leader within the oil and gas industry, operates with minimal synergies within James Fisher’s predominantly maritime-focused service offerings. The sale is thus seen as a logical step in James Fisher’s ongoing strategy to simplify its operations and concentrate on areas where it can deliver the most value.

Jean Vernet, Chief Executive Officer of James Fisher, commented on the disposal, highlighting its role in simplifying the company’s portfolio and strengthening its financial position. He expressed confidence in the value this transaction brings to shareholders, considering RMS’s robust performance in recent years. Vernet also extended gratitude to the RMS team for their dedication and hard work, underscoring the opportunity for ChampionX to enhance RMS’s success further.

The disposal of RMSpumptools to ChampionX represents a strategic pivot for James Fisher and Sons plc, underscoring the company’s commitment to focusing on its core competencies. This transaction not only promises to improve James Fisher’s financial metrics but also allows it to invest more efficiently in growth areas aligned with its strategic vision. For ChampionX, acquiring RMS offers an opportunity to strengthen its portfolio in the oil and gas sector, leveraging RMS’s market-leading products and technologies. This deal exemplifies how strategic divestitures can serve as a catalyst for growth and realignment in today’s dynamic market landscapes.

  Business Disposal, ChampionX UK Limited, EBITDA, enterprise value, Financial Strategy, James Fisher and Sons plc, Maritime Services, oil and gas industry, RMSpumptools Limited, shareholder value