Pentair Acquires Porous Media, Furthers Its Water Strategy
Pentair announced it has entered into a definitive agreement to acquire Porous Media, a privately held Minnesota company with manufacturing operations in both Minnesota and Texas. The acquisition accelerates the Company's water strategy by strengthening its filtration and separation technology portfolio and extending its reach into attractive new markets.
"Porous Media is a compelling strategic fit with our existing water business," said Randall J. Hogan, chairman and chief executive officer. "We will leverage Porous Media's filtration and separation technologies across Pentair's existing Water customers, especially in markets outside of North America. For example, we believe Porous Media's oil separation technologies, developed for the petrochemical market, will effectively address unmet needs for our existing wastewater reuse and recovery customers globally," he said. "In addition, we will capture synergies from the acquisition by applying Pentair's Integrated Management System, especially our supply management and lean disciplines," Hogan said.
The Company noted that the acquisition also brings strong technical talent to its Water Group, including engineering, material science, media development and application capabilities. These strengths are reflected in Porous Media's current product offerings and robust new product development pipeline.
Porous Media's well-protected product portfolio includes high-performance filter media, membranes and related filtration products and purification systems for liquids, gases and solids for the general industrial, petrochemical, refining and healthcare market segments, among others. Within its offering, consumable products represent more than 80 percent of Porous Media's sales and provide an established base of recurring revenue, according to Pentair.
Pentair said the transaction is expected to close in the second quarter of 2007, and that the purchase price is approximately $225 million or, adjusted for tax benefits, 9.7 times 2007 expected EBITDA. Pentair expects the acquisition to be approximately $0.03 to $0.04 dilutive in fiscal year 2007, with a significant portion of the dilution attributable to the fair market step-up in inventory. Pentair also announced it is reducing the top end of its previously announced 2007 earning guidance range of $2.00 to $2.15 to reflect the dilutive impact of the acquisition.
Pentair, Inc. (NYSE:PNR) is a diversified operating company headquartered in Minnesota. Its Water Group is a global leader in providing innovative products and systems used worldwide in the movement, treatment, storage and enjoyment of water. Pentair's Technical Products Group is a leader in the global enclosures and thermal management markets, designing and manufacturing thermal management products and standard, modified, and custom enclosures that house and protect sensitive electronics and electrical components. With 2006 revenues of $3.15 billion, Pentair employs approximately 15,000 people worldwide.
Source: Pentair plc.