Goodwin has agreed to a £1.1bn acquisition offer from an affiliate of the US global alternative investment firm, Cerberus, for part of its mechanical engineering division.

The deal, which follows an extensive sale process conducted by the enginnering firm, will see the sale of a number of brands, including Goodwin Steel Casting, Goodwin International, Noreva, Easat and Pumps.

Goodwin said it intends to pay a "significant proportion" of the net cash sale proceeds to its shareholders.

It stated that it believes the transaction represents a "compelling opportunity to unlock significant shareholder value", while creating a more focused group and enhanced capacity to invest in its remaining businesses.

Chairman at Goodwin, Timothy J. W. Goodwin, stated: "Today's announcement represents a significant milestone in the history of Goodwin as we reposition our business and deliver significant value for our shareholders.

“We are excited about the future of the businesses being transferred and confident that this is in the best of interests of not only shareholders, but wider stakeholders. As we look ahead, we are confident of continued success and growth in our remaining businesses and thank all our employees for their continued dedication."

Following the announcement, shares in Goodwin dropped by 3.5%.

Head of markets at AJ Bell, Dan Coatsworth, concluded: "After a stellar run the Stoke-on-Trent business hit a major bump in the road when it revealed in March it had lost two significant contracts and had been hit by order hold-ups linked to the Middle East crisis.

"The latest bout of volatility follows a strategic review of its defence arm, with private equity firm Cerberus plotting a bid. When a £1bn price tag was reported yesterday afternoon the shares slumped as investors were left disappointed, with confirmation of discussions around a £1.1bn deal doing little to inspire either.

"Goodwin may now feel some pressure to push for a higher price tag to get shareholders on board, although given the Goodwin family hold a 50%-plus stake, ultimately any decision is likely to rest with them."

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