ABB acquires US electric motor giant
01 December 2010
ABB has announced that it will acquire the US electric motor and drives manufacturer Baldor in an all-cash transaction valued at approximately $4.2bn, including $1.1bn of net debt. The transaction closes a gap in ABB’s automation portfolio in North America by adding Baldor’s strong NEMA motors product line. Baldor also adds a growing and profitable mechanical power transmission business to ABB’s portfolio.
The transaction is expected to ease ABB’s access to the industrial customer base in North America, opening opportunities for sales of the company’s wider product portfolio, including energy efficient drives and complementary motors. The move coincides with regulatory changes in the US and other parts of the world that will accelerate demand for energy efficient industrial motion products.
“ABB chief executive, Joe Hogan says Baldor is a great company with an extremely strong brand in the world’s largest industrial market. “Baldor’s product range and regional scope are highly complementary to ours and give both companies significant opportunities to deliver greater value to our customers.”
Meanwhile, Baldor chairman and chief executive, John McFarland says the transaction is in the best interest of shareholders, employees and customers. “We are excited about the opportunity to join ABB’s worldwide family as we have always respected ABB. We are very pleased that ABB will locate its motor and generator business headquarters for North America in Fort Smith and we are confident that the combined global platform will be well positioned to capitalize on meaningful growth opportunities in the future.” The Baldor drives business will be combined with the larger ABB drives business.
Ron Tucker, Baldor’s current president and chief operating officer, and chief executive designate, will run Baldor, including the mechanical power transmission products business and ABB’s motor and generator business in North America after the transaction is completed. John McFarland is expected to stay on to support the integration of the businesses.
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