Spectra Premium Industries Inc. announced it has signed an agreement with TRICO Group LLC for the purchase of Spectra Premium’s fuel pumps and related products inventory for the American market.
Under the terms of the agreement, Trico will gradually purchase Spectra Premium’s inventory of fuel pumps and related products for the US market, thereby ensuring an orderly transition with customers for these products. The agreement, which is subject to normal due diligence and court approval, is expected to be finalized within 30 days.
“Our fuel pump distribution operations in the United States required significant working capital without generating the expected financial returns,” said Jacques Mombleau, President and CEO of Spectra Premium Industries Inc. “This transaction will allow us to significantly reduce our debt level, a key element of our recovery plan and an initiative that is in line with our goal of focusing our efforts and financial resources on product manufacturing, where our offering remains competitive. This is a first step in our ongoing efforts to emerge from protection under the Companies’ Creditors Arrangement Act,” he concluded.
Spectra Premium also announced it would discontinue the sale of automotive heat transfer products in the United States (radiators, condensers and heater radiators) by the end of July. The US market for this type of product is also very competitive due to global overcapacity. In addition, tariffs imposed on products imported from China into the United States limit Spectra Premium’s ability to remain competitive in this market.
Spectra Premium is maintaining the sale of all its other product lines in the US market, including industrial radiators, as part of its recovery plan. These decisions will not affect its product offering in the Canadian market. The company will continue to offer all of its product lines in Canada, where operations will continue as usual.