Monday, August 22, 2016
Flow Factor Sells Penberthy Jets and Level Controls
Pentair Announces Agreement to Sell Valves & Controls Business to Emerson
MANCHESTER, United Kingdom – August 18, 2016 – Pentair plc (NYSE: PNR) today announced it has reached an agreement to sell its Valves & Controls business to Emerson (NYSE: EMR). 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 prioritize 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.
INVESTORS CONFERENCE CALL
Pentair Chairman and CEO Randall J. Hogan and Chief Financial Officer John L. Stauch will discuss the transaction and updated guidance for the company excluding Valves & Controls on a two-way conference call with investors at 8:00 a.m. Eastern tomorrow, Friday, August 19. A live audio webcast of the call, along with the related presentation, can be accessed in the Investors section of the company's website, www.pentair.com, shortly before the call begins or by dialing 866-271-5991 or 973-638-3449 along with conference number 67785387. A replay of the conference call will be made accessible once it becomes available and will remain accessible through midnight on September 18, 2016 by dialing 855-859-2056 or 404-537-3406 along with the conference number 67785387. The webcast presentation will be archived at the company's website following the conclusion of the event.
ABOUT PENTAIR 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.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains statements that we believe to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact are forward-looking statements. Without limitation, any statements preceded or followed by or that include the words "targets," "plans," "believes," "expects," "intends," "will," "likely," "may," "anticipates," "estimates," "projects," "should," "would," "positioned," "strategy," "future" or words, phrases or terms of similar substance or the negative thereof, are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond our control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include the company’s ability to complete the sale of Valves & Controls on anticipated terms and timetable, overall global economic and business conditions, including worldwide demand for oil and gas; the ability to achieve the benefits of our restructuring plans; the ability to successfully identify, finance, complete and integrate acquisitions, including the ability to successfully integrate and achieve the expected benefits of the acquisition of ERICO Global Company; competition and pricing pressures in the markets we serve; the strength of housing and related markets; volatility in currency exchange rates and commodity prices; inability to generate savings from excellence in operations initiatives consisting of lean enterprise, supply management and cash flow practices; increased risks associated with operating foreign businesses; the ability to deliver backlog and win future project work; failure of markets to accept new product introductions and enhancements; the impact of changes in laws and regulations, including those that limit U.S. tax benefits; the outcome of litigation and governmental proceedings; and the ability to achieve our long-term strategic operating goals. Additional information concerning these and other factors is contained in our filings with the U.S. Securities and Exchange Commission ("SEC"), including in our 2015 Annual Report on Form 10-K. All forward-looking statements speak only as of the date of this report. We assume no obligation, and disclaim any obligation, to update the information contained in this report.
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Vice President, Investor Relations & Strategic Planning
Senior Manager, External Communications