Pentair plc has announced it has reached an agreement to sell its Valves & Controls business to Emerson. The cash purchase price is $3.15 billion, subject to customary working capital adjustments. The transaction is anticipated to be completed late in 2016 or early in 2017 and is subject to customary closing conditions and necessary regulatory approvals.
Randall J. Hogan, Pentair Chairman and CEO stated, “We expect this transaction to provide Pentair the ability to advance our strategy, drive growth, and focus resources on three segments, all of which we believe have attractive growth characteristics.”
Pentair acquired the Valves & Controls business in 2012 through an all-stock merger with the Flow Control business of Tyco International Ltd. Valves & Controls’ 2015 revenue was $1.8 billion. “Through the hard work of dedicated employees, we significantly improved Valves & Controls’ operating profit, creating shareholder value,” said Mr. Hogan. “Additionally, the Flow Control acquisition provided the scale and capital structure to further enable our strategy for growth. “
Following the closing of the transaction, Pentair’s business will consist of three segments, Water Quality Systems, Flow & Filtration Solutions, and Technical Solutions, aligned with global trends to deliver solutions around water quality and availability, equipment and building protection, industrial and process efficiency, and food and beverage processing.
“We remain narrowly diversified, which allows us to prioritise investments and affords us opportunities to grow organically and use our strengthened balance sheet as opportunities arise,” said Mr. Hogan.
Citi and Goldman, Sachs & Co. are serving as financial advisors to Pentair and Foley & Lardner LLP is providing legal counsel.
Pentair plc (www.pentair.com) delivers industry-leading products, services and solutions for its customers’ diverse needs in water and other fluids, thermal management and equipment protection. With 2015 revenues of $6.4 billion, Pentair employs approximately 28,000 people worldwide.
