Regal Rexnord Corporation Completes Previously Announced Acquisition of Arrowhead Systems

BELOIT, Wisconsin., 23 November 2021 / PRNewswire / – Regal Rexnord Corporation (NYSE: RRX) today announced that it has completed the acquisition of Arrowhead Systems, a global leader in providing industrial process automation solutions, in a transaction in cash valued at $ 297 million.

We are delighted to welcome Arrowhead to Regal Rexnord,” noted Louis pinkham, CEO of Regal Rexnord. “Arrowhead aligns perfectly with our strategy to transform Regal Rexnord into a faster growing, higher margin company. Its highly sophisticated automation and palletizing products and solutions – many of which directly support growing consumer demand for more environmentally friendly packaging – are differentiated and highly valued by its customers, as evidenced by its strong organic growth rates. in sales and gross margins in their 30s.

“The company is also perfectly complementary to our Regal Rexnord motion control offering, which includes various engineering components and subsystems, supporting attractive revenue and cost synergies estimated at $ 12 million and a ROIC greater than 10%, both at year 5. “

Arrowhead joins Regal Rexnord as part of its Motion Control Solutions (MCS) segment.

About Regal Rexnord
Regal Rexnord Corporation is a global leader in the engineering and manufacturing of industrial powertrain solutions, power transmission components, electric motors and electronic controls, airflow products, and specialty electrical components and systems. , serving customers around the world. Through long-standing technological leadership and an intentional focus on producing more energy efficient products and systems, Regal Rexnord is helping to create a better future – for its customers and for the planet.

Regal Rexnord is comprised of four business segments: Motion Control Solutions, Climate Solutions, Business Systems and Industrial Systems. Regal Rexnord is headquartered at Beloit, Wisconsin and has manufacturing, sales and service facilities around the world. For more information visit RegalRexnord.com.

Forward-looking statements
This press release contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which reflect Regal Rexnord’s current estimates, expectations and projections regarding the future results, performance, prospects and opportunities of Regal Rexnord. These forward-looking statements may include, among others, statements regarding the merger with the PMC business or the acquisition of Arrowhead, the benefits and synergies of the transactions described in this communication regarding the acquisitions of the PMC business and Arrowhead. (the “Transactions”), future opportunities for Regal Rexnord, and any other statements regarding future operations of Regal Rexnord, expected levels of activity, future earnings, expected activities, expected growth, market opportunities, strategies, competition and other expectations and estimates for future periods. Forward-looking statements include statements that are not historical fact and may be identified by forward-looking words such as “anticipate”, “anticipate”, “believe”, “confident”, “estimate”, “expect”, ” plan ”,“ may ”,“ will ”,“ project ”,“ plan ”,“ would ”,“ could ”,“ should ”and similar expressions. These forward-looking statements are based on information currently available to Regal Rexnord and are subject to a number of risks, uncertainties and other factors that could cause actual results, performance, prospects or opportunities to differ. substantially from those expressed or implied by, these forward-looking statements. Important factors that could cause actual results to differ materially from the results mentioned in forward-looking statements made by Regal Rexnord in this communication include: risks related to any unforeseen changes or effects on liabilities, future capital expenditures, income, expenses, synergies, indebtedness, financial situation, losses and future prospects; the possibility that Regal Rexnord may not be able to realize the synergies and operational efficiencies expected from the Transactions on schedule or not at all and to successfully integrate the PMC and Arrowhead businesses; expected or targeted future financial and operational performance and results; operating costs, loss of customers and business disruptions (including, without limitation, difficulties in maintaining relationships with employees, customers, customers or suppliers) being greater than expected following Transactions; Regal Rexnord’s ability to retain key officers and employees; the continued financial and operational impacts and uncertainties associated with the COVID-19 pandemic on customers and suppliers and the geographies in which they operate; uncertainties regarding the ability to execute restructuring plans on time and at expected costs; the ability to obtain the intended tax treatment of the PMC business acquisition and related transactions; the actions of competitors and their ability to compete effectively in the increasingly competitive global industries of electric motors, drives and controls, power generation and power transmission; the ability to develop new products based on technological innovation, such as the Internet of Things, and market acceptance of new and existing products, including technology-related products that have not yet been adopted or used in the geographic areas where Regal Rexnord operates; fluctuations in raw material prices and raw material costs; dependence on large customers; seasonal impact on product sales in HVAC systems and other residential applications; risks associated with global manufacturing, including risks associated with public health crises; problems and costs arising from the integration of acquired companies and activities and the timing and impact of accounting purchasing adjustments; Regal Rexnord’s overall indebtedness levels and its ability to repay principal and interest on its outstanding debt, including debt assumed or incurred in connection with the Transactions; prolonged declines in one or more markets, such as heating, ventilation, air conditioning, refrigeration, power generation, oil and gas, unit material handling or water heating; economic changes in world markets, such as declining demand for products, exchange rates, inflation rates, interest rates, recession, government policies, including policy changes affecting the taxation, trade, tariffs, immigration, customs, border actions and others, and other external factors that Regal Rexnord cannot control; product liability and other disputes, or claims from end users, government agencies or others that customers’ products or applications have not performed as intended, especially in high volume applications or where such failures are presumed to be the cause of damage claims; unforeseen liabilities of acquired businesses; unanticipated negative effects or liabilities of business exits or disposals; unforeseen costs or expenses that may be incurred related to product warranty issues; dependence on key suppliers and the potential effects of supply disruptions; third party intellectual property infringement, intellectual property disputes and third party technology infringement claims; the effects on results of any significant impairment of goodwill or intangible assets; losses due to failures, breaches, attacks or disclosures involving IT infrastructure and data; economic downturns affecting the world capital goods market; changes in the method of determining the London Interbank Offered Rate (“LIBOR”), or the replacement of LIBOR by another benchmark rate; and other risks and uncertainties, including, but not limited to, those described in the section entitled “Risk Factors” in Regal Rexnord’s joint proxy statement / prospectus filed with the Securities and Exchange Commission, in Regal Rexnord’s Annual Report on Form 10 -K filed with the SEC and from time to time in other filed reports, including Regal Rexnord’s Quarterly Reports on Form 10-Q. For a more detailed description of the risk factors associated with Regal Rexnord, please refer to the Regal Rexnord Annual Report on Form 10-K for the year ended. January 2, 2021 in SEC records and subsequent SEC filings. Shareholders, potential investors and other readers are urged to take these factors into account when evaluating forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this communication are made only as of the date of this communication, and Regal Rexnord does not undertake to update any forward-looking information contained in this communication or with respect to the announcements described herein to reflect subsequent events or conditions.

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