Business Blog: Hoover’s Business Insight Zone

During the 1990s, ABB overexpanded pretty radically. Here, let me quote our (more detailed, subscriber-only) profile on the company:

ABB has undergone extensive restructuring after years in which it overdiversified, racked up huge debts, alienated investors, and faced the threat of bankruptcy. The company hived off many of its far-flung businesses, including units that dealt in wind energy, capital finance, high-voltage cables, export banking, metering equipment, and marine switchgear. Over the course of two years in the early 2000s, the company pared its enormous workforce by a quarter.

Right. Anyway, under CEOs Jürgen Dormann and then Fred Kindle, the company has slimmed and slimmed and slimmed, simplifying and strengthening its focus around its key businesses in power transmission and industrial automation. Now, at long last, ABB has struck a deal to sell its Lummus engineering services unit, which has been on the block for what seems like forever.

The lucky purchaser of Lummus is Chicago Bridge & Iron, which is paying $950 million to add Lummus to its own sprawling footprint of operations. That chunk of change will come in handy for ABB, but more than that, it will close the books on a chapter of its corporate life that is best put behind it.