ENGlobal Corporation: Reduces Operations

ENGlobal Announces Agreement to Sell its Midstream Inspection Division to Furmanite

Houston, TX, Dec. 11, 2012 (GLOBE NEWSWIRE) -- ENGlobal Corporation (NASDAQ: ENG), a leading provider of energy-related engineering and automation services, announced today that it has reached an agreement on terms under which ENGlobal's Midstream Inspection division will be divested to Furmanite America, Inc. ("FAI") a subsidiary of Furmanite Corporation.  The total value of the transaction to ENGlobal is expected to be approximately $6.5 million, consisting of cash at closing, retained working capital, and a promissory note issued with a parent company guarantee.

ENGlobal intends to use the net proceeds from this transaction to reduce outstanding debt.  The transaction is expected to close at year-end, subject to lender approval and the completion of customary conditions.

"Once closed, this sale ensures that 100% of management's attention can be applied to ENGlobal's Engineering and Automation segments," said William A. Coskey, P.E., Founder, Chairman and Chief Executive Officer. "Since August, ENGlobal has been focused on divesting our Field Solutions segment, leading improvement initiatives, and implementing an organizational restructuring that has resulted in a more efficient company."

ENGlobal announced its plan to explore divestiture options of its Field Solutions segment, which included both its Land/Right of Way and Midstream Inspection divisions, in September 2012.  The Company will complete the divestiture within both the timeline and the estimated value attributed to the segment by ENGlobal.

Opinion:

I think it is a good move; getting the house cleaning done for the 'next step'. Ensuring that 100% of management's attention on anything also sounds good to me; on core segments that can be sold - even better.

Good luck to everyone.