Pentair (PNR) To Spin Off Electrical Business, Retain Water
Zacks Investment Research | May 09, 2017 09:33PM ET
Pentair plc (NYSE:PNR) will spin off its electrical unit, which manufactures enclosures and other products for electrical systems. Instead, the company wants to focus on core water treatment business, which makes treatment and processing systems. The separation will happen in the second quarter of 2018 and is expected to occur through a tax-free spin-off of Electrical by Pentair to its shareholders. Following the news, Pentair’s shares gained 2.48%.
Both the businesses will trade as two independent, publicly-traded companies. The companies will boast of market-leading positions in their respective industries through renowned brands, attractive margin profiles, strong free cash flow generation and compelling growth opportunities.
The Water business, which generated approximately $2.8 billion in sales in 2016, will continue under the Pentair name. The newly formed leading global water company will be focused on smart, sustainable water and fluid processing applications. It will design, manufacture and deliver innovative solutions to residential, commercial and industrial customers. Its main business groups will include Filtration & Process, Flow Technologies and Aquatic & Environmental Systems.
Meanwhile, the electrical business generated approximately $2.1 billion in sales in 2016. It will be turned into a high-performance electrical company focused on improving utilization, lowering costs and maximizing customer uptime. Its industrial enclosures, fastening systems and thermal management technologies help protect sensitive equipment, buildings and critical processes and ensure safety. Strategic business groups include Enclosures, Thermal Management and Electrical & Fastening Solutions. The company will be named at a later date.
Pentair PLC. Price
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