Hexagon Purus divests aerospace business to SpaceX

Hexagon Purus ASA (Oslo, Norway), through one of its wholly owned subsidiaries, entered into an agreement to divest its aerospace business to Space Exploration Technologies Corp. (SpaceX, Hawthorne, Calif., U.S.) on Feb. 5.

The transaction comprises the sale of 100% of the shares of Hexagon Masterworks Inc., which supplies high-pressure composite storage cylinders for aerospace and space launch applications in North America, and for hydrogen mobility applications. The hydrogen business is not part of the transaction perimeter, and Masterworks’ existing hydrogen customer contracts are intended to be transferred to other parts of Hexagon Purus prior to closing.

The transaction implies an enterprise value of approximately $15 million, comprising (i) a cash consideration of $12.5 million payable at closing, and (ii) a contingent cash earn-out of $2.5 million, subject to applicable closing conditions and customary adjustments. A requisite number of bonds under Hexagon Purus’ 2023 and 2024 bond agreements have undertaken to approve closing of the transaction.

Hexagon Purus’ aerospace business has developed well in recent years and has now reached a stage where an industrial owner with a dedicated aerospace focus is deemed to best support its future. At the same time, the company does not expect the hydrogen mobility market in North America to represent significant potential in the near-to-medium term. The divestment is therefore aligned with its ongoing portfolio review, with the transaction strengthening Hexagon Purus’ financial position and extending the liquidity runway.

Philpott Ball & Werner LLC acted as financial advisor and TCF Law Group, PLLC and Advokatfirmaet Schjødt acted as legal advisors to the company in connection with the transaction.