[February 11, 2019] |
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Ingersoll Rand Announces Plans to Acquire Precision Flow Systems
Ingersoll-Rand plc (NYSE:IR), a world leader in creating comfortable,
sustainable and efficient environments, today announced it has made a
binding offer to acquire Precision Flow Systems ("PFS") from funds
advised by BC Partners Advisors L.P. and The Carlyle Group for $1.45
billion.
PFS is a leading provider of fluid management systems with world class
brands including Milton Roy®, LMI®, Haskel®,
BuTech®, Dosatron®, YZ Systems®,
Williams® and Hartell®. It serves mission critical
applications including water, agriculture, food and beverage,
pharmaceuticals and process industries. PFS generated sales of
approximately $400 million in 2018, has approximately 1,000 employees
and operates seven global manufacturing locations.
At the time of acquisition close, PFS would combine with Ingersoll
Rand's Fluid Management business, which designs, manufactures, and
markets pumps for specialized fluid handling applications under the ARO®
brand. The PFS product portfolio is complementary with Ingersoll Rand's
Fluid Management portfolio.
"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," said Michael W. Lamach, chairman and chief executive officer
of Ingersoll Rand. "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.
"With PFS, Ingersoll Rand will be well positioned as a leading provider
of complex, mission critical pump and flow management technologies
across highly diverse and attractive end markets and verticals. This
proposed acquisition aligns well with our focus on consistent, top
quartile performance in revenue, margins and cash flow, and is
compelling both strategically and financially for our customers and our
shareholders."
"We are proud of the growth and development of PFS under our ownership,"
said Charles Treadway, chief executive officer of Accudyne Industries,
which has operated PFS since 2012. "Ingersoll Rand's offer to acquire
PFS is a strong endorsement of the value of this business. We are
confident that PFS will continue to reach new heights as part of a
leading global company and we believe this presents an exciting
opportunity for our PFS employees, distributor partners, and
end-customers."
Sundyne remains owned by funds advised by BC Partners Advisors L.P. and
The Carlyle Group.
Ingersoll Rand plans to fund the proposed acquisition through a
combination of cash on hand and debt.
Ingersoll Rand expects to enter into a definitive securities purchase
agreemnt for the proposed acquisition upon completion of information
and consultation processes with PFS employee representative bodies in
applicable jurisdictions. The proposed acquisition is expected to close
in mid-2019, subject to regulatory approval.
Investor Conference Call
Ingersoll Rand will hold a conference call to discuss this announcement
beginning at 10:00 a.m. ET, Monday, February 11, 2019. A real-time,
listen-only webcast of the conference call will be broadcast live over
the internet. Individuals wishing to listen can access the call through
the company's website at www.ingersollrand.com
under the investor relations section. For those unable to listen to the
live event, a replay will be available on the company's website at
approximately 1 p.m. ET February 11, 2019.
Investors and equity analysts may dial (833) 236-2748 to participate in
today's call.
Goldman Sachs & Co. LLC. acted as exclusive financial advisor and
Kirkland & Ellis LLP acted as legal advisor for Ingersoll Rand in this
transaction. Morgan Stanley & Co. LLC acted as exclusive financial
advisor and Latham & Watkins LLP acted as legal advisor for Precision
Flow Systems in this transaction.
Forward-Looking Statements
This press release contains "forward-looking statements," which are
statements that are not historical facts, including without limitation
statements about the proposed transaction and the anticipated timing
thereof; the expected benefits of the proposed transaction, the impact
of the transaction on our financial positions, results of operations,
cash flows, financing plans, business strategy, operating plans, capital
and other expenditures and competitive positions. These forward-looking
statements are based on our current expectations and are subject to
risks and uncertainties, which may cause actual results to differ
materially from our current expectations. Such factors include, but are
not limited to, our ability to timely obtain, if ever, necessary
regulatory approvals of the proposed transaction; adverse effects on the
market price of our ordinary shares and on our operating results because
of our inability to timely complete, if ever, the proposed transaction;
our ability to fully realize the expected benefits of the proposed
transaction; negative effects of announcement or consummation of the
proposed transaction on the market price of the company's ordinary
shares; significant transaction costs and/or unknown liabilities;
general economic and business conditions that may impact the companies
in connection with the proposed transaction; unanticipated expenses such
as litigation or legal settlement expenses; changes in capital market
conditions; the impact of the proposed transaction on the company's
employees, customers and suppliers; and the ability of the companies to
successfully integrate operations after the transaction. Additional
factors that could cause such differences can be found in our Form 10-K
for the year ended December 31, 2017, as well as our subsequent reports
on Form 10-Q and other SEC (News - Alert) filings. We assume no obligation to update
these forward-looking statements.
Non-GAAP Financial Measures
This news release includes a discussion of Adjusted EBITDA margin, which
is a non-GAAP financial measure. Adjusted EBITDA margin is defined as
the ratio of Adjusted EBITDA divided by net revenues. Adjusted EBITDA
consists of GAAP net income from continuing operations excluding: (i)
depreciation and amortization, (ii) other income / (expense), net, (iii)
income taxes, and (iv) restructuring. Adjusted EBITDA margin should be
considered supplemental to, not a substitute for or superior to, its
equivalent GAAP financial measure. Adjusted EBITDA margin has
limitations in that it does not reflect all of the costs associated with
the operations of our businesses as determined in accordance with GAAP.
In addition, Adjusted EBITDA margin may not be comparable to non-GAAP
financial measures reported by other companies. A reconciliation of
Adjusted EBITDA margin is not available at this time because it is long
term in nature and estimates for the integration related costs are not
available at this time.
About Ingersoll Rand
Ingersoll Rand (NYSE:IR) advances the quality of life by creating
comfortable, sustainable and efficient environments. Our people and our
family of brands - including Club Car®, Ingersoll Rand®, Thermo King®
and Trane (News - Alert)® - work together to enhance the quality and comfort of air in
homes and buildings; transport and protect food and perishables; and
increase industrial productivity and efficiency. We are a global
business committed to a world of sustainable progress and enduring
results. For more information, visit ingersollrand.com.

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