In a move that could bring some new jobs to the Baton Rouge area, Netherlands-based CB&I announced this week that it plans to sell the Capital Services division of its company to a New York-based private equity firm, Veritas Capital.
The deal, valued at $775 million, will have implications for some 1,500 CB&I employees in the Baton Rouge area who work in the company’s Capital Services division. Veritas Capital officials tell Daily Report the changes will be positive for the local market, where they hope to grow their new company.
“Baton Rouge will remain a vital area of operations for the company, and we are committed to growing our presence there,” says Ramzi Musallam, CEO and managing partner of Veritas Capital. “We expect that the business will increase jobs locally and provide economic development throughout the state.”
CB&I’s Capital Services division handles maintenance and environmental work, and the bulk of the company’s Capital Services employees are based in Baton Rouge at the company’s Essen Lane office. Veritas officials suggest the company could grow its footprint in the environmental services area in particular, noting that the region’s focus on water management and control is well aligned with the company’s capabilities.
CB&I’s Livingston Parish-based pipe fabrication business is under the fabrication division of the company and is unaffected by the pending sale, which is expected to close sometime between April and June.
CB&I has been looking to sell its Capital Services business since it acquired The Shaw Group in 2013 for $3.04 billion. CB&I President and CEO Philip Asherman told investors in a conference call Tuesday that the Capital Services business “wasn’t core to our strategy,” adding the proceeds from the sale will be used to pare down CB&I’s $2.2 billion debt.
