Parker Acquires Sporlan Valve Company

12.10.2004

Parker Hannifin Corporation and Sporlan Valve Company jointly announced that Parker has completed its acquisition of Sporlan, a market leader in refrigeration and air conditioning components, controls and systems, for an undisclosed amount.

The deal is expected to be accretive to earnings in the first full fiscal year.

Headquartered in Washington, Missouri, Sporlan operates seven manufacturing facilities and employs about 1,000 people. Annual revenues are approximately $150 million. Recognizing Sporlan's prominent position in the industry, Parker will make Sporlan a new division within Parker's Climate & Industrial Controls Group.

The acquisition is complementary, with Sporlan adding its leadership in the commercial refrigeration and aftermarket distribution segments of the market to Parker's existing strong presence in the air conditioning segment. In addition, Sporlan's expertise in electronic control technologies now enables Parker to offer customers more precise cooling solutions that reduce energy consumption, provide system diagnostic capabilities, and deliver enhanced performance.

"Parker's goal is to be number one or two in every market we serve," said CEO Don Washkewicz. "Refrigeration is one of the high potential growth markets we've focused on for expansion, and the addition of Sporlan greatly enhances our leadership in refrigeration and air conditioning worldwide."

The addition of Sporlan enhances Parker's R&D capabilities. Together, both businesses benefit from economies of scale in procurement and manufacturing, increased sales representation, and unrivaled distribution.

"Sporlan is a very successful company we've admired for a long time," said Lynn Cortright, president of Parker's Climate & Industrial Controls Group. "Together, our two companies will have the most complete offering of valves and controls for the widest range of applications in the refrigeration and air conditioning market today. From supermarket refrigeration to ice machines to residential and commercial air conditioning, Parker and Sporlan will have the ability to deliver total systems to our customers.

"Sporlan is synonymous with quality and is made up of hard-working employees and a management team that knows how to deliver profitability," added Cortright. "At Parker, we value all of these characteristics. We want Sporlan to continue to operate very much as it always has. Our focus is on growing the business globally and achieving even greater value together."

"We've respected Parker for many years," said Ken Ohlemeyer, President, Sporlan Valve Company. "When it became clear that Sporlan was ready to enter a new level of growth, Parker quickly emerged as the best partner. Parker's global infrastructure presents a great opportunity to complement Sporlan's existing worldwide distribution network and to expand the reach of Sporlan's products even further, all over the world. I'm confident that joining Parker will offer our customers significant advantages."

With annual sales of more than $7 billion, Parker Hannifin is the world's leading diversified manufacturer of motion and control technologies and systems, providing precision-engineered solutions for a wide variety of commercial, mobile, industrial and aerospace markets. The company employs more than 48,000 people in 46 countries around the world. Parker has increased its annual dividends paid to shareholders for 48 consecutive years, among the top five longest-running dividend-increase records in the S&P 500 index.

Forward-Looking Statements:

Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. All statements regarding future performance, earnings projections, events or developments are forward-looking statements. It is possible that the future performance and earnings projections of the company and individual segments may differ materially from current expectations, depending on economic conditions within both its industrial and aerospace markets, and the company's ability to achieve anticipated benefits associated with announced realignment activities, strategic initiatives to improve operating margins, and growth initiatives. A change in economic conditions in individual markets may have a particularly volatile effect on segment results. Among the other factors which may affect future performance are: changes in business relationships with and purchases by or from major customers or suppliers, including delays or cancellations in shipments; uncertainties surrounding timing, successful completion or integration of acquisitions; threats associated with and efforts to combat terrorism; competitive market conditions and resulting effects on sales and pricing; increases in raw-material costs that cannot be recovered in product pricing; and global economic factors, including currency exchange rates, difficulties entering new markets and general economic conditions such as interest rates. The company makes these statements as of the date of this disclosure, and undertakes no obligation to update them.

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