UK engineering group Goodwin has agreed to sell a substantial portion of its defence-related Mechanical Engineering division to US private equity firm Cerberus Capital Management for £1.1bn ($1.49bn), according to a report by Reuters.
The transaction covers Goodwin Steel Castings, Goodwin International, Noreva, Easat Group and Pumps, with the businesses supplying components for naval vessels and submarine programmes in both the UK and US.
The deal comes amid strong demand for precision-engineered castings used in defence and nuclear applications, alongside growing exports to the US Navy. Goodwin said the Mechanical Engineering division was a strong performer in its latest financial year, with revenues increasing by almost 39% in fiscal 2026.
Goodwin, which is listed in London and also manufactures specialist valves, pumps and other engineered products, began exploring a potential disposal of parts of its Mechanical Engineering division in August as part of a broader strategic review.
The company said it intends to return a significant proportion of the proceeds to shareholders.
The proposed sale follows a sharp reaction in Goodwin’s share price after reports of the discussions emerged. The stock fell 23% on Tuesday and declined a further 4% on Wednesday.
The valuation has prompted some debate among analysts, given the strategic importance of the assets. John West, global head of analysis at Mergermarket, said the price might be viewed as reasonable for some casting businesses but questioned whether that adequately reflected Goodwin’s position as a key supplier to the UK and US navies.
The transaction is likely to face scrutiny from the UK government under the National Security and Investment Act, which gives ministers powers to intervene in deals involving assets considered important to national security.
Goodwin’s UK operations remain its largest source of revenue, accounting for 29% of the group’s total, while the US has expanded to approximately 24%, according to the company’s latest annual report.
