Ingersoll Rand Hopes to Help the Planet in the Long Term


Mar. 14 2016, Published 4:07 p.m. ET

Ingersoll Rand’s mission

Ingersoll Rand’s (IR) mission is to help solve some of the world’s most pressing challenges, including the demand for energy resources and the impact on greenhouse gas emissions. It hopes to improve energy efficiency and productivity by 2030.

Article continues below advertisement

Ingersoll Rand’s vision

Part of Ingersoll Rand’s vision is to reduce approximately 21 million metric tons of CO2e (carbon dioxide equivalent) globally before 2020. That’s equivalent to the energy used by nearly 2 million US homes in one year. To accomplish these goals, IR is planning to introduce products that meet the following criteria:

  • energy-efficient
  • operationally efficient
  • refrigerants with dramatically lower GWP (global warming potential)
  • refrigerants that don’t compromise the safety, performance, or efficiency that end users expect

The company’s key milestones specified for 2020 are as follows:

  1. to reduce the climate impact related to refrigerant used in its products by 50% before 2020 and incorporate lower GWP alternatives by 2030
  2. to reduce the GHG (greenhouse gas) footprint of operations by 35% before 2020
  3. to invest $500 million in product-related research and development over the next five years to fund long-term reduction of GHG emissions.

Ingersoll Rand’s strategies

Some of Ingersoll Rand’s recent purposeful strategies were to sell Hussmann, spin off Allegion, and finalize a tax agreement with the IRS (Internal Revenue Service).

IR has agreed to sell its remaining equity interest in Hussmann Parent to Panasonic, subject to regulatory approval. In return, IR will receive net proceeds of approximately $425 million. This will provide immediate value to IR shareholders. We’ll cover the Hussmann deal in more detail in Part 7 of this series.

Similarly, the decision to spin off Allegion (ALLE) was to reduce overhead costs. Allegion manufactures door locks and locking systems for residential and commercial buildings.

IR is part of the Guggenheim Mid-Cap Core ETF (CZA) and accounts for 2.0% of the total holdings. Investors in this ETF could benefit if IR continues to deliver operational excellence and surpass its targets for 2016. Viacom (VIA) and DTE Energy (DTE) are among the top ten holdings of CZA and account for 2.9% and 2.3%, respectively, of the fund.

In the next part, we’ll take a close look at Ingersoll Rand.


More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.