Parker Hannifin Completes LORD Acquisition
30 October 2019 - 1:02AM
Parker Hannifin Corporation (NYSE:PH), the global leader in motion
and control technologies, today completed its acquisition of LORD
Corporation – a leading manufacturer of advanced adhesives and
coatings, as well as vibration and motion control technologies –
for approximately $3.675 billion in cash. The strategic
transaction creates a combined organization with strong
materials science capabilities, electrification and aerospace
product offerings that are highly complementary.
The transaction is expected to drive significant
value for shareholders through increased organic growth, higher
EBITDA margins, stronger cash flow and add to Parker’s earnings per
share, excluding one-time costs and deal related
amortization. LORD will strengthen Parker’s portfolio of
attractive margin and high growth businesses, and significantly
expand Parker’s materials science capabilities with complementary
products, better positioning Parker to serve customers in growth
industries and capitalize on emerging trends such as
electrification and lightweighting.
“We are excited about the opportunity to
strengthen our technology portfolio by significantly bolstering our
position in engineered materials,” said Tom Williams, Chairman and
Chief Executive Officer of Parker. “Acquiring LORD is expected to
improve operating margins and its organic growth rate will help
improve the resiliency of the Parker portfolio, strengthening our
ability to achieve top quartile financial performance.”
“The LORD acquisition will allow us to deliver
greater value to our existing and future customers,” said Andy
Weeks, Parker’s Engineered Materials Group President. “We welcome
the talented LORD team who have built a high performing business
with strong product brands such as Chemlok®. Going
forward, we will work collaboratively to integrate our businesses
by leveraging the best ideas, capabilities and practices of both
organizations.”
An integration team has been formed and a detailed
integration plan is underway, designed to allow for a smooth
transition between Parker and LORD and to realize synergies between
the two organizations.
About Parker HannifinParker
Hannifin is a Fortune 250 global leader in motion and control
technologies. For more than 100 years the company has
engineered the success of its customers in a wide range of
diversified industrial and aerospace markets. Parker has increased
its annual dividend per share paid to shareholders for 63
consecutive fiscal years, among the top five longest-running
dividend-increase records in the S&P 500
index. Learn more at www.parker.com or
@parkerhannifin.
About LORD CorporationLORD Corporation is a
diversified technology and manufacturing company developing highly
reliable adhesives, coatings, and vibration and motion control
technologies that significantly reduce risk and improve product
performance. For more than 90 years, LORD has worked in
collaboration with its customers to provide innovative aerospace,
defense, automotive and industrial solutions.
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. These statements
may be identified from the use of forward-looking terminology such
as “anticipates,” “believes,” “may,” “should,” “could,”
“potential,” “continues,” “plans,” “forecasts,” “estimates,”
“projects,” “predicts,” “would,” “intends,” “anticipates,”
“expects,” “targets,” “is likely,” “will,” or the negative of these
terms and similar expressions, and include all statements regarding
future performance, earnings projections, events or developments.
Parker cautions readers not to place undue reliance on these
statements. It is possible that the future performance and earnings
projections of the company, including its individual segments, may
differ materially from current expectations, depending on economic
conditions within its mobile, industrial and aerospace markets, and
the company's ability to maintain and achieve anticipated benefits
associated with announced realignment activities, strategic
initiatives to improve operating margins, actions taken to combat
the effects of the current economic environment, and growth,
innovation and global diversification initiatives. Additionally,
the actual impact of changes in tax laws in the United States and
foreign jurisdictions and any judicial or regulatory
interpretations thereof on future performance and earnings
projections may impact the company’s tax calculations. A change in
the economic conditions in individual markets may have a
particularly volatile effect on segment performance.
The risks and uncertainties in connection with
such forward-looking statements related to the transaction include,
but are not limited to, economic conditions within the company’s
and LORD’s key markets, and the ability of the company and LORD to
maintain and achieve anticipated benefits associated with the
transaction, strategic initiatives to improve operating margins,
and growth, innovation and global diversification initiatives;
business disruptions due to transaction-related uncertainty or
other factors making it more difficult to maintain relationships
with employees, business partners or governmental entities; the
possibility that the expected synergies and value creation from the
transaction will not be realized or will not be realized within the
expected time period; the parties being unable to successfully
implement integration strategies; and significant costs related to
the transaction. Readers should consider these forward-looking
statements in light of and in conjunction with risk factors
discussed in Parker’s Annual Report on Form 10-K for the fiscal
year ended June 30, 2019 filed on August 23, 2019 and other
periodic filings made with the SEC. Parker makes these statements
as of the date of this disclosure and undertakes no obligation to
update them unless otherwise required by law.
###
Media –
Aidan Gormley, Director, Global Corporate Communications and Branding
216/896-3258
aidan.gormley@parker.com
Financial Analysts –
Robin J. Davenport, Vice President, Corporate Finance
216/896-2265
rjdavenport@parker.com
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