DISPOSITION OF ALLOY PIPING PRODUCTS, LLC

6 Months Ended

Jun. 30, 2019

Discontinued Operations And Disposal Groups [Abstract]

DISPOSITION OF ALLOY PIPING PRODUCTS, LLC

NOTE 4—DISPOSITION OF ALLOY PIPING PRODUCTS, LLC

We performed a review of our business portfolio, which included businesses acquired in the Combination. Our review sought to determine if any portions of our business are non-core for purposes of our vertically integrated offering model. As a result of our review, we identified our industrial storage tank and pipe fabrication businesses as non-core for purposes of our vertically integrated offering model. On June 24, 2019, we entered into an agreement to sell APP, the distribution and manufacturing arm of our pipe fabrication business, previously included in our NCSA segment. We completed the sale of APP on June 27, 2019.

Loss on the APP sale is included in Loss on asset disposals in our Statement of Operations and is summarized as follows:

	(In millions)
Assets
Inventory	$	69
Property and equipment		25
Goodwill		90
Other assets		11
Assets sold	$	195
Liabilities
Account payable	$	8
Other liabilities		3
Liabilities sold	$	11
Net assets sold	$	184
Sale proceeds (net of transaction costs of $2)		83
Loss on net assets sold	$	101

Results of APP’s operations during the three and six-month periods ended June 30, 2019 and 2018 were not material to McDermott, as a whole.

We are continuing to pursue the sale of the remaining portion of the pipe fabrication business, subject to approval by our Board of Directors.