Fortive to sell 4 A&S companies to Altra Industrial in $3 billion deal
Staff Writer |
Fortive Corporation announced that it has entered into a definitive agreement to combine four operating companies from its Automation & Specialty platform (A&S platform) with Altra Industrial Motion.
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This is a tax-efficient transaction, creating a pure-play, global leader in the power transmission and motion control market.
Total consideration to Fortive and its shareholders is approximately $3.0 billion, including $1.4 billion in cash proceeds and debt reduction for Fortive and 35 million newly issued Altra common shares to Fortive’s shareholders, valued at approximately $1.6 billion based on the 20-day volume weighted average stock price of Altra shares.
The A&S platform business includes the market-leading brands of Kollmorgen, Thomson, Portescap and Jacobs Vehicle Systems. The A&S platform generated approximately $907 million in revenue for its fiscal year ended December 2017.
The combination will be effected as a Reverse Morris Trust, which is expected to be tax-efficient to Fortive.
Fortive shareholders will receive shares representing approximately 54.4% of the issued and outstanding shares of Altra after giving effect to the transaction and valued at approximately $1.6 billion.
In addition, Fortive will directly receive added consideration of $1.4 billion through a combination of cash proceeds and debt reduction.
Until closing, which is expected to occur by the end of 2018, the A&S platform businesses will operate within the Industrial Technology segment of Fortive, and financial results will be reported in continuing operations.
Fortive will have the right to designate one member of Altra’s board of directors, expected to initially be Patrick J. Murphy, Senior Vice President of Fortive.
The combined revenue of Altra and the four A&S businesses on a trailing 12 months basis was approximately $1.8 billion, making it a leading pure-play in power transmission and motion control. ■