RBC Bearings to Buy ABB's Mechanical Power Transmission Division for $2.9 Billion
26 Juli 2021 - 2:15PM
Dow Jones News
By Dave Sebastian
RBC Bearings Inc. has agreed to buy Asea Brown Boveri Ltd.'s
Dodge mechanical power transmission division for $2.9 billion in
cash, the companies said.
Dodge, based in Greenville, S.C., makes mounted bearings,
enclosed gearing and transmission components. It operates in the
construction and mining aftermarket, food and beverage, warehousing
and general machinery sectors, with sales mainly in the
Americas.
RBC Bearings said it expects the deal to immediately add to its
per-share earnings by about 40% to 60% in the first full fiscal
year after close, excluding amortization of intangibles, deferred
financing fees, and one-time deal costs associated with the
transaction. The company said it expects cash per-share earnings to
be between $7 and $8 a share in the first fiscal year.
RBC Bearings said the deal is supported by a fully committed
bridge facility, with permanent financing expected to include a mix
of debt and equity.
Dodge had revenue of about $600 million for the year ended June
30, according to ABB, as Asea Brown Boveri is known. The unit has
about 1,500 employees world-wide. ABB said it expects to book a
non-operational pretax book gain of about $2.2 billion on the sale
of Dodge. It also sees transaction-related cash tax outflows of
about $400 million.
The companies expect the deal to close in the fourth
quarter.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
July 26, 2021 08:03 ET (12:03 GMT)
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