Pentair Launches Exploration of Strategic Alternatives for Its Tools Group
GOLDEN VALLEY, Minn., Feb. 4 /PRNewswire-FirstCall/ -- Pentair, Inc.
(NYSE: PNR) announced today that it entered into an agreement to acquire WICOR
Industries, a unit of Wisconsin Energy Corporation (NYSE: WEC), Milwaukee,
Wisconsin. WICOR, which manufactures water system, filtration, and pool
equipment products under the Sta-Rite, SHURflo, and Hypro brands, is expected
to generate sales of approximately $750 million in 2003 and employs 3,500
people in 24 locations worldwide. The $850 million cash transaction, which
Pentair plans to complete in the second or third quarter of 2004, is subject
to satisfaction of customary conditions and applicable regulatory approvals.
Pentair expects to finance the purchase of WICOR, including the assumption of
approximately $24 million of WICOR debt, through available and committed lines
of credit. The acquisition is anticipated to be accretive to earnings in the
first 12 months of ownership.
Pentair also announced that it has engaged Goldman, Sachs & Co. to explore
strategic alternatives for its Tools Group, with 2003 sales of $1.08 billion,
comprising the Porter-Cable, Delta, DeVilbiss Air Power, Oldham Saw, and FLEX
businesses.
"The WICOR acquisition will transform Pentair into a diversified company
defined largely by a $2 billion Water Technologies business," said Pentair
Chairman and Chief Executive Officer, Randall J. Hogan. "Not only do we
anticipate creating a significant water and wastewater systems business having
some $900 million in sales, but we will also be operating a global pool and
spa equipment business with revenues of roughly $600 million. We expect our
revenues in the filtration and purification space to jump to approximately
$500 million. We would become considerably more global in scope, with
anticipated total international water-related sales of 20 percent or about
$400 million. This transaction will allow us to accelerate Pentair's growth
through the more rapid creation of innovative products and systems, and
capture cost savings and other synergies, thereby adding value for our
customers and shareholders."
According to Richard J. Cathcart, president and chief operating officer of
Pentair's Water Technologies Group, "This transaction represents a giant step
toward our goal of satisfying the global need for safe, clean water. We expect
to combine Pentair's proven operating disciplines with WICOR's strong customer
orientation to enhance sales relationships with our customers, build our
collective brands, grow our technology, accelerate the development of
innovative products, expand our global footprint, and deliver superior
products and service to our customers.
"Growing the sales of our Water Technologies business will be a top
priority," Cathcart noted. "Accomplishing that goal is a task made easier by
the fact that both Pentair and WICOR possess strong management teams, have
experience in the water industry, and have recognized products. There are also
strong parallels in our company cultures, both of which are built on core
values of integrity and respect."
Pentair has a solid record of success in managing the integration of
acquired water businesses. In 2002, Pentair acquired the Plymouth Products
water filtration equipment business from USFilter. In the first year of
ownership by Pentair, Plymouth Product's profits improved 17 percent, while
EBIT margins gained 150 basis points.
"Pentair has made 11 acquisitions in the Water Technologies arena since
1995, and each has increased sales, captured synergies, and contributed to
Pentair's earnings within the first 12 months of ownership. We expect to
generate similar results with the integration of WICOR," Cathcart said. "We
have a rigorous integration planning process underway with a fully staffed
integration planning office and more than a dozen teams for our business units
and functional business support. We expect to save more than $30 million in
the first full year of ownership, primarily through sourcing, supply chain,
and manufacturing synergies."
Pentair said that although the Water Technologies Group will be its
largest business, the Company remains committed to a diverse business mix.
"Our Enclosures Group has done a tremendous job of fighting through a
difficult market downturn during the last three years," Hogan said. "Today, we
believe this business is well positioned to continue growing profitably, as
evidenced by its eight consecutive quarters of margin improvement. Our proven
ability to capture organic growth in Enclosures is one of several strengths we
expect to lever to create a larger business platform. In addition, we will
continue to enjoy the benefits that a diverse business portfolio offers
Pentair's shareholders."
In a separate announcement, Pentair said its fourth quarter 2003 earnings
per share from continuing operations was $0.69, a 21 percent gain over fourth
quarter 2002 EPS of $0.57.
Pentair's Water Technologies Group manufactures water and wastewater pumps
for water systems; filters, control valves, tanks, and pressure vessels for
filtration systems; and pool and spa equipment, with $1.06 billion in sales in
2003. The Group's key brand names include: Myers, Hydromatic, Aurora, and
Fairbanks Morse pumps; Fleck and SIATA water conditioning valves; WellMate and
Structural tanks; Plymouth Products, American Plumber, Pentek, and Everpure
filtration products; National Pool Tile, Rainbow Lifegard, Kreepy Krauly,
Letro Products, and Pentair Pool Products.
About Pentair, Inc.
Pentair is a diversified operating company headquartered in Minnesota. Its
Water Technologies Group is a global leader in providing innovative products
and systems used worldwide in the movement, treatment, storage and enjoyment
of water. Pentair's Enclosures group is a leader in the global enclosures
market, serving industrial and electronic customers, and its Tools Group
manufactures and markets innovative products under established brand names to
professionals and do-it-yourself users. Pentair's 2003 revenues totaled
$2.7 billion. The company employs more than 12,000 people in over 50 locations
around the world.
This report contains statements that we believe to be "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995, including any statements about the company's anticipated sales,
synergies or other results or expected benefits of the WICOR acquisition.
These forward-looking statements generally can be identified by the use of
words such as "believes," "anticipates" or "expects," or words of similar
import. Such forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ from those currently
anticipated, including the company's ability to integrate the WICOR
acquisition successfully, the ability to obtain regulatory approvals of the
acquisition on anticipated terms and schedule, and the risk that expected
synergies may not be fully realized or may take longer to realize than
expected. Forward-looking statements included herein are made as of the date
hereof and the company undertakes no obligation to update publicly such
statements to reflect subsequent events or circumstances.
Fact Sheet
Pentair Acquisition of WICOR Industries
Background
Pentair Inc. (NYSE: PNR) entered into an agreement to acquire WICOR
Industries, a unit within Wisconsin Energy Corporation (NYSE: WEC). WICOR
Industries manufactures water pumps, water treatment products and fluid
handling equipment.
The WICOR acquisition positions Pentair as a leader in the global water
market, where worldwide demand is expected to exceed $350 billion in 2004.
Completion of the transaction is expected in the second or third quarter of
2004, subject to customary regulatory approval and other conditions.
Pentair background
Pentair is a diversified operating company that builds value for
stakeholders by acquiring, renewing, and developing manufacturing companies.
With 2002 sales of $2.6 billion, Pentair comprises three core business groups:
enclosures, tools, and water technologies. Headquartered in Golden Valley,
Minnesota, the company employs 12,000 people in more than 50 locations around
the world. Pentair common stock is traded on the New York Stock Exchange under
the symbol PNR.
The Enclosures Group consists of Hoffman Enclosures, Pentair Electronic
Packaging, and Pentair Enclosures Europe. Brand names include Schroff and
Hoffman. Enclosure products include electrical and electronic enclosures,
custom and off-the-shelf packaging solutions, datacom, telecom and server
original equipment manufacturing. The Group employs 4,200 people in 13
locations worldwide.
The Tools Group consists of Delta, Porter-Cable, DeVilbiss Air Power
Company, and the Tool Accessories Platform. Brands include Delta, Porter-
Cable, Air America, Ex-Cell, Power Back, Oldham Saw, FLEX, Hickory, United
States Saw, and Viper. Tool products include woodworking machinery, power
tools, saw fences, woodworking accessories, retail air compressors and
pressure washers, and generators. The Group employs 3,300 people in 10
locations in North America, Germany and Asia.
The Water Technologies Group manufactures water and wastewater pumps;
control valves, tanks and pressure vessels for water conditioning systems; and
pool and spa equipment. The Group employs 4,200 people in 21 locations around
the world.
Pentair Water Technologies Group Background
Brands and Products
Pumps: Aurora, Fairbanks, Myers and Hydromatic. Pump product lines include
well and irrigation, sump and sewage, fire, HVAC, municipal water and
wastewater.
Pool and Spa: Pentair, Kreepy Krauly, IntelliTouch and National Pool Tile.
Pool and spa products include pumps, filters, controls, lights and cleaners.
Water Treatment: Fleck, SIATA, Structural and CodeLine. Water treatment
products include valves, tanks and membrane housings.
Filtration: Pentek, American Plumber, Armor and Everpure. Filtration
products include filter cartridges (carbon & specialty), filter systems,
housings and valve boxes.
Locations
Pentair Water Technologies has approximately 3 million square feet of
manufacturing floor space worldwide. Manufacturing locations in the United
States include California (2 locations), Illinois (2 locations), Kansas, New
York, North Carolina, Ohio (3 locations), Arizona and Wisconsin (2 locations).
International manufacturing facilities include Belgium, China, France (2
locations), India, Italy, South Africa and the United Kingdom.
Pentair Water Technologies also has 5 distribution locations throughout
the world.
WICOR Industries Background
WICOR Industries is a unit within Wisconsin Energy Corporation, a
Milwaukee-based company with a diversified portfolio of businesses engaged in
electric generation; electric, gas, steam and water distribution; pump
manufacturing; and other non-utility businesses.
WICOR is a leading global manufacturer of water pumps, water treatment
products and fluid handling equipment, with $750 million in sales in 2003.
WICOR employs 3,100 people worldwide in 24 locations worldwide. Its three
major operations include Sta-Rite Industries, SHURflo Pump Company and Hypro
Corporation.
Sta-Rite Industries: A worldwide manufacturer of pumps and water
processing equipment, Sta-Rite serves the agricultural, residential, leisure,
industrial and commercial markets. Its water systems, pool and spa, and water
treatment products move and improve water in more than 100 countries.
SHURflo Pump Company: Provides a complete line of small air, water and
electric driven pumps to the beverage, recreational vehicle, marine and water
purification markets, and to key segments of the industrial market.
Hypro Corporation: Manufactures a complete line of pumps that are sold
throughout the world in the agricultural, pressure cleaning, marine and fire
service markets.
Brands and Products
Water Systems: Sta-Rite, Aermotor, Berkeley, Flotec, Diamond and Simer.
Water systems products include a diverse line of high-performance pumps to
serve the industrial, commercial and agricultural markets and pressurized
water storage tanks. Water systems also produces basement dewatering pumps and
sump, effluent and sewage products.
Pools: Sta-Rite and Onga. Manufactures pool and spa pumps, filters,
cleaners, heaters, lights, fittings and accessories.
Spa and Bath: Vico, Onga, Sta-Rite and Ultra-Jet. Produces pumps, filters,
cleaners, heaters, lights, fittings and accessories.
Water Treatment: Sta-Rite, Park International, Fibredyne and Omnifilter.
Water treatment products include pumps, accumulators, filters, and many
accessories to handle water system needs. Manufactures core technologies
systems for water delivery and R.O. treatment, a full range of filter systems,
water boost systems and a variety of water handling systems for residential,
commercial and the food service industry.
Agriculture: Hypro, SHURflo and Berkeley. Offers a complete line of
roller, centrifugal, piston and diaphragm pumps, as well as accessories and
spray tips for all types of spraying applications.
Fire Services: FoamPro and Edwards. Produces foam proportioning systems
for use in firefighting applications.
Recreational Vehicles: RV products include potable water pumps, general
purpose pumps, faucets, water system accessories, water filtration products
and pump repair and rebuild kits.
Marine: SHURflo, Hypro and Sherwood. Marine products include pumps for
applications such as potable water, general purpose, livewell, bilge, washdown
and maceration. Also markets faucets, water system accessories, water
filtration products and pump repair and rebuild kits.
Food Service: SHURflo. The Fluid Solutions Group offers a broad line of
products for the food service industry, from bag-in-box technologies to
condiment systems to water filtration and purification.
Industrial: SHURflo, Hypro and Sherwood. Specially adapted pump product
lines are available for agriculture, automotive, floor care and solar markets.
Locations
WICOR has approximately 2 million square feet of manufacturing floor space
worldwide. Manufacturing locations in the United States include California (5
locations), Indiana, Minnesota (2 locations), Nebraska, New Hampshire, Oregon
and Wisconsin. International manufacturing facilities include Australia,
Canada, China, England, Germany, India, Italy (3 locations), Mexico (2
locations) and New Zealand.
WICOR also has sales and distribution locations throughout the world,
including the United States (10 locations), Australia (6 locations), Canada (2
locations), Mexico (2 locations), Italy (2 locations), New Zealand (2
locations), England (2 locations), China, France, Germany, India, Kazakhstan
and Russia.
Contact:
Mark Cain, Pentair
Tel. (763) 656-5278
e-mail: mark.cain@pentair.com
SOURCE Pentair, Inc.