[ID] => 11021
[post_author] => 6150
[post_date] => 2019-05-14 15:32:44
[post_date_gmt] => 2019-05-14 14:32:44
[post_content] => Gardner Denver is to combine with the industrial segment of Ingersoll Rand. The two entities have entered into a definitive agreement under which Ingersoll Rand will separate its Industrial segment (Ingersoll Rand Industrial) by way of a spin-off to Ingersoll Rand’s shareholders and combine it with Gardner Denver. The combined entity, currently referred to as ‘IndustrialCo’ is expected to take the name Ingersoll Rand and trade under Ingersoll Rand’s existing ticker on the New York Stock Exchange.
IndustrialCo will be composed of the entirety of Gardner Denver and Ingersoll Rand Industrial, including, subject to closing, Ingersoll Rand’s pending acquisition of Precision Flow Systems, which is expected to be finalised in mid-2019.
The HVAC and transport refrigeration assets of the current Ingersoll Rand will become a pure play expert in climate control solutions for buildings, homes and transport. This new entity will, at the time of closing, receive $1.9bn in cash from Ingersoll Rand Industrial, funded by newly issued debt assumed by Gardner Denver in the merger. The terms of this agreement have been unanimously approved by the boards of directors for both Gardner Denver and Ingersoll Rand.
HOLDING THE REINS
The new Ingersoll Rand’s management team will be led by current Gardner Denver CEO, Vicente Reynal, and comprise executives from both companies. Its Board of Directors will be led by Gardner Denver’s chairman, Peter Stavros, and consist of 10 directors, seven of which will be selected by Gardner Denver’s board of directors and three by Ingersoll Rand’s board of directors. Once the merger has been finalised, corporate operations will move to Davidson, North Carolina.
“This transaction will create a global leader in mission-critical flow creation and industrial technologies, and accelerate both companies’ strategic priorities of deploying talent, driving growth, expanding margins through increased efficiencies and allocating capital effectively,” says Reynal. “Together we believe we will create meaningful value for shareholders through our increased scale and reach, unmatched portfolio of iconic brands, highly compelling service and aftermarket platform, exposure to diverse and attractive end markets and geographies, and the expected realisation of significant synergies. We look forward to combining the strengths and talents of our teams and providing our customers with more comprehensive solutions and broader, industry-leading product, service and aftermarket offerings.”
The transaction is expected to close by early 2020, subject to approval by Gardner Denver stockholders, regulatory approvals and customary closing conditions. The pro forma revenue is predicted to be $6.6bn, with approximately 40 per cent recurring services and aftermarket revenue, and adjusted EBITDA of approximately $1.6bn, including annualised cost synergies of approximately $250m expected to be achieved by the end of year three.
Upon closing, IndustrialCo intends to grant all employees who are not already equity eligible with an equity award totalling approximately $150m. “In the same spirit in which we granted stock to our employees during Gardner Denver’s IPO, we feel strongly that all employees of IndustrialCo should be owners of their business,” says Stavros. “We believe in fostering an ownership mentality, and that this drives motivation and engagement, something that has been clear in Gardner Denver’s strong performance. We look forward to offering this equity award to all eligible employees of the combined company and working together to drive the business forward to create value for all of our shareholders.”
[post_title] => Merger: Winds of change
[post_status] => publish
[comment_status] => open
[ping_status] => open
[post_name] => merger-winds-of-change
[post_modified] => 2019-05-14 15:35:30
[post_modified_gmt] => 2019-05-14 14:35:30
[post_parent] => 0
[guid] => https://www.hcblive.com/?p=11021
[menu_order] => 0
[post_type] => post
[comment_count] => 0
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Gardner Denver and Ingersoll Rand have agreed a merger that will create a global leader in mission-critical flow management and industrial technologies