Babcock International Group said on Friday it had agreed to sell its consultancy unit Frazer-Nash for £293-million ($404.5-million) to help shore up the British engineering firm’s balance sheet and cut debt.
The company, whose net debt was £1.35-billion as of March 31, began reviewing its balance sheet and contract profitability after hiring new leadership last year.
Frazer-Nash is part of Babcock’s services to the marine sector and operates from nine U.K. and four Australian locations, the company said, adding that the deal would require approval by the Australian foreign investment authority.
The company counts the U.K. Ministry of Defence as its biggest customer.
“We are making real progress on our plan to streamline and focus the group on our key markets,” Chief Executive Officer David Lockwood said, adding that the unit was a good fit for U.S. engineering firm KBR, its new owner.
The sale forms part of Babcock’s targeted disposal program, which aims to generate at least £400-million of proceeds in the next twelve months.
Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.