Ingersoll Rand’s acquisition plans
In a press release on February 11, Ingersoll Rand (IR) announced that it made a binding offer to acquire Precision Flow System from funds advised by BC Partners Advisors and The Carlyle Group. The deal is valued at $1.45 billion. Ingersoll Rand is expected to fund the proposed acquisition through cash on hand and debt. If everything goes well, the deal is expected to be completed by mid-2019.
The acquisition is expected to complement Ingersoll Rand’s fluid management portfolio. The acquisition would likely help Ingersoll Rand’s fluid management strategy and diversify its portfolio. Michael W. Lamach, Ingersoll Rand’s chairman and CEO, said, “The proposed acquisition of PFS will accelerate the strategic growth of our highly profitable Fluid Management business in our Industrial segment, while significantly diversifying and enhancing our product portfolio. PFS brings a talented, customer-focused team with expertise in sales, service, engineering, and manufacturing, which is a great addition to the company and our Fluid Management team.”
Precision Flow System is a leading provider of the fluid management system. The company caters to mission-critical applications like food and beverage, pharmaceuticals, agriculture, water, and process industries. In 2018, Precision Flow System reported revenues of $400 million. The company has seven global manufacturing locations across the world with ~1,000 employees.
On February 11, Ingersoll Rand rose 0.6% and closed at $102.51. Honeywell (HON) fell 0.1%, while Stanley Black & Decker (SWK) and Caterpillar (CAT) rose 1.2% and 0.26%, respectively. The S&P 500 (SPY) remained flat with marginal gains of 0.05%.