Mergers & Acquisitions Review 2003

Pump Industry Analyst

January 2004

Mergers & Acquisitions Review 2003 Despite the uncertainties generated by the Iraq war, the SARS epidemic and the generally weak global economy, 2003 proved to be yet another year of consolidation for the global pump sector. Roisin Reidy outlines the main deals that marked the year. Company

Activity

Comment

FEATURE

Fourth quarter 2003 Howden Pumps

Agreed to merge with Orbit (see Pump Industry Analyst, December and October 2003).

The merger will create one of the largest pump suppliers in South Africa.

National-Oilwell

Acquired Canada’s Corlac Equipment Ltd for C$33 million in cash (see Pump Industry Analyst, December 2003). Corlac supplies oilfield production equipment, including progressive cavity fluid transfer pumps and surface pumps. Corlac also distributes Monoflo progressive cavity fluid transfer pumps.

Looks like a strong fit with NOI’s Mono pump business which was acquired in Q1 2003.

ITT Industries

Formally launched a take-over bid for Wedeco AG Water Technology, the German manufacturer of ozone oxidation and ultraviolet disinfection equipment (see Pump Industry Analyst, December and November 2003).

The acquisition will complement Sanitaire’s biological and filtration divisions and fits ITT Industries’ strategy of strengthening its businesses through the acquisition of adjacent technologies.

Pentair

Entered into an agreement to acquire water filtration products maker Everpure Inc from USFilter for US$215 million (see Pump Industry Analyst, December 2003).

Together with Plymouth Products, Everpure gives Pentair a broad platform for growth in filtration technologies.

KSB

Acquired an 80% controlling share of Bombas Itur SA, the Zarautz, Spain- With 250 employees and annual sales of
30 million, Bombas Itur is one of Spain’s largest pump makers so the deal should significantly based pump maker (see Pump Industry Analyst, November 2003). strengthen KSB’s position in the Spanish market.

Kirloskar Brothers Ltd Took over SPP Pumps Ltd, the UK manufacturer of water and fire pumps (see Pump Industry Analyst, November 2003).

An important landmark deal for India’s largest pump manufacturer.

Veolia Environnement Announced that it tended to sell most of its USFilter businesses in order to reduce debt (Pump Industry Analyst, November 2003).

The sale of the USFilter assets continues efforts to reverse a costly series of Vivendi acquisitions.

Third quarter 2003 Howden Pumps

Renewed its merger talks with Orbit Pump Manufacturing (Pty) Ltd and Orbit Pumps (Botswana) (Pty) Ltd (see Pump Industry Analyst, October 2003).

The companies conducted merger talks in 2002 but they failed to finalize a deal.

Idex Corp

Added Classic Engineering Inc, the Jacksonville, Florida-based designer and manufacturer of chemical-feed systems for the water, wastewater, chemical, OEM, pulp and paper, cement and general industrial markets, to its Pulsafeeder unit (see Pump Industry Analyst, October 2003).

The deal complements Pulsafeeder's efforts to provide engineered solutions.

Smith & Loveless

Acquired Biomixer Corp, a California-based manufacturer of fine bubble aeration and mixing systems (see Pump Industry Analyst, October 2003).

Biomixer will operate as a separate Smith & Loveless division and will relocate to an existing Smith & Loveless office and manufacturing facility in Norwalk, California.

Lutz-Jesco

Bought Bissendorf, Germany-based Technopool Schwimmbadtechnologie GmbH (see Pump Industry Analyst, September 2003).

Technoppol specializes in a salt-water-light water treatment process for swimming pools.

KSB

Expanded its European service network with the acquisition of Enterprise Industrielle de Travaux et de Bobinages (EITB) in France and Mechanical Services on Site (MSOS) in Belgium (see Pump Industry Analyst, September 2003).

The deal brings the number of KSB service sites throughout Europe to 61.

Weir Engineering Services

Acquired Allen Gwynnes Pump business (see Pump Industry Analyst, September 2003).

The acquisition is consistent with WES’s expansion and complements the growth of its turbo machinery business.

Colfax Corp

Called off its planned acquisition of the family-owned Netzsch Group (see Pump Industry Analyst, September and May 2003).

In a statement Netzsch said that Colfax “could not meet the parameters of the acquisition finance facility.”

Smiths Group

Sold its Polymer Sealing Solutions business to Sweden’s Trelleborg AB in a £495 million cash deal (see Pump Industry Analyst, August 2003).

Polymer Sealing Solutions included Busak + Shamban, Dowty Auto, Shamban and Forsheda.

Thomas Industries

Acquired its Swedish distributor, Aldax AB, for an undisclosed sum (see Pump Industry Analyst, August 2003).

Now renamed Rietschle Thomas, the company will be responsible for selling the full range of Rietschle Thomas products into Sweden, Finland and the Baltic States.

Second quarter 2003 Pentair

Acquired TwinPumps Inc, a New Jersey-based manufacturer of vortex and Starting in 2004, the TwinPumps products will be manufactured at chopper pumps for municipal wastewater and industrial applications Pentair’s Fairbanks Morse plant in Kansas City. (see Pump Industry Analyst, July 2003).

Crane

Purchased Etex Group SA’s pipe coupling and fittings interests for £17.3 million in cash and assumed debt (see Pump Industry Analyst, June 2003)

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The deal includes the business assets in the UK related to the Victaulic, Viking Johnson and Wask brands, as well as associated shares of GPS Couplings BV (Netherlands).

January 2004

Pump Industry Analyst

Company

Activity

Comment

Smith & Loveless

Sold its UK affiliate Kalsep Ltd to Hydranautics BV (see Pump Industry Analyst, May 2003).

Kalsep specializes in the engineering of membrane based water treatment systems for municipal and industrial applications.

Polyair Inter Pak

Closed the purchase of Jacuzzi Inc’s and Jacuzzi Leisure Products Inc’s swimming pool assets in a US$41.2 million deal (see Pump Industry Analyst, May 2003).

This acquisition will increase Polyair's revenues by 50% and establish its Pool Products Group as a stronger player in the North American swimming pool sector.

Spirax Sarco

Acquired the Watson-Marlow Bredel peristaltic pump distributorships in South Africa from Walter Becker (see Pump Industry Analyst, May 2003).

Watson-Marlow Bredel had an agreement for some years with Walter Becker that they would eventually start their own operation in South Africa. The deal allows liquid ring vacuum pump maker Vooner FloGard to focus on lowering the long term costs of dewatering systems in paper mills.

Bran+Luebbe Lightnin Waukesha CherryBurrell

Merged to form SPX Process Equipment (see Pump Industry Analyst, May 2003).

Parent company SPX Corp said that the new merger capitalized on the strengths of each business unit, enabling SPX Process Equipment to build an even stronger platform and product offering in flow technology and process equipment.

KSB

Bought the Dutch pump manufacturing company DP Industries BV (see Pump Industry Analyst, June and May 2003).

The company, with 280 employees, will be turned into a KSB Group sheet metal competence centre.

Colfax Corp

Announced that it planned to acquire Germany's Netzsch Group, a family company specializing in pumps, grinding and dispersing equipment, filtration systems and analyzing and test equipment (see Pump Industry Analyst, May 2003).

Formed in 1995, the privately-held Colfax Corp has expanded through a series of acquisitions. At the time of the announcement, the Colfax Pump Group included Allweiler, Houttuin, Imo Pump, Imo AB and Warren Pumps.

Shin Nippon Machinery

Became a wholly-owned subsidiary of Sumitomo Heavy Industries Ltd through a share exchange (see Pump Industry Analyst, January 2003).SNM’s product range includes pumps for water supply as well as industrial pumps for semiconductors, chemicals and medicines.

SHI says it will target growth for SNM in larger turbines and special pumps that will meet market needs.

First quarter 2003 Northstar Aerospace

Sold its pump interests to its joint venture partner Industrias EG SA (see Pump Industry Analyst, April 2003).

The Mexican group now owns 100% of the common stock of Monterrey-based Corporacion EG and therefore has full ownership of the subsidiary companies Ruhrpumpen GmbH and Ruhrpumpen Inc.

Northern Pump

Parent company McNally Industries acquired by Treval Holdings (see Pump Industry Analyst, April 2003).

Investment company Treval Holdings was formed to buy-and-build a major supplier of engineered systems and components for defence and aerospace applications.

Grundfos

Bought into Brazil with the acquisition of Mark Peerless SA (see Pump Industry Analyst, April 2003). Mark Peerless produces pumps for industrial, fire extinguishing and water supply applications and has annual sales of approximately US$8 million.

Nearly half of the shares in Mark Peerless SA were acquired from Sterling Fluid Systems. Grundfos has renamed the company Mark Pumps Ltd.

ITT Flygt

Added the business and assets of Uniservice Wellpoint Srl to its pump portfolio (see Pump Industry Analyst, April 2003).

The acquisition of Wellpoint helps Flygt migrate from a product provider to a solutions provider.

Crane

Divested Chempump to Teikoku USA Inc, a subsidiary of Japan's Teikoku Electric Manufacturing Co (see Pump Industry Analyst, March 2003).

The acquisition gives Teikoku a manufacturing base in the USA that will allow it to take ful advantage of NAFTA.

Lutz Pumpen

Acquired Wedemark, Germany-based Jesco Dosiertechnik (see Pump Industry Analyst, March 2003).

Lutz-Jesco GmbH will continue Jesco's production and delivery program, which covers dosing systems for all media.

AxFlow

Spanish subsidiary acquired Barcelona-based Colfax Bombas from the German pump maker Allweiler AG, a member of The Colfax Pump Group (see Pump Industry Analyst, March 2003).

Colfax Bombas's product line includes Allweiler screw, progressing cavity and centrifugal pumps as well as Houttuin and IMO screw pumps. With the acquisition, these product lines will now be distributed on an exclusive basis by AxFlow SA in Spain and Portugal.

KSB

Finnish joint venture - Mercantile KSB Oy Ab - became a wholly owned The company is now trading as KSB Finland Oy. subsidiary on 1 January 2003 (see Pump Industry Analyst, February 2003).

ITT Industries

Bought the Biopharm Manufacturing Division of Martin Petersen Co Inc, a specialist in process systems for the biopharmaceutical industry (see Pump Industry Analyst, February 2003).

The acquisition was the latest step in Engineered Valves’ strategy to build a market basket of premier brands and services serving the biopharm market.

VDA Pompen

Acquired by fellow Dutch company the Thole Group (see Pump Industry Analyst, February 2003).

VDA Pompen specializes in centrifugal pumps.

Pentair

Expanded its pool product line by acquiring the swimming pool heat pump Sold under the HydroTemp and MiniMax Plus HP brand names, the assets of HydroTemp Manufacturing Co (see Pump Industry Analyst, company's products are marketed through swimming pool and HVAC February 2003). distributors. HydroTemp has annual sales of US$9 million and employs 21 people.

Oase Group

Completed a management buyout (see Pump Industry Analyst, February 2003).

Oase specializes in water gardening products and accessories, including pumps, filters, lighting and ornamental fountains.

Wilo

Acquired EMU Submersible Pumps Group based in Hof, Germany from Etschel & Meyer GmbH + Co KG (see Pump Industry Analyst, January 2003).

Wilo AG CEO Michel Laroche said he planned ambitious growth for the new acquisition, using Wilo’s established worldwide sales organization. Strong growth should lead to the future expansion of the production plant in Hof, while EMU and Wilo will benefit from research and development synergies.

Halliburton

Sold its Mono pumping business to National Oilwell (see Pump Industry Analyst, January 2003). Headquartered in Manchester, UK, Mono has additional facilities in the USA and Australia. Mono had revenues of approximately US$80 million in 2002.

At the time of the sale, National Oilwell said it expected to contribute significant additional volume to the Mono business.

Johnson Pump

Acquired 100% control of Johnson Pumpen AG (Switzerland) and Johnson Johnson Pump says it will now be able to more effectively integrate Pump Italiana Srl (Italy) (see Pump Industry Analyst, January 2003). operations with the rest of the Group as well as strengthen its position in Italy and Switzerland.

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FEATURE

Vooner FloGard Corp Completed the acquisition of CVN Systems from nash elmo industries (see Pump Industry Analyst, May 2003).