Nortek (Nasdaq, NTK), a manufacturer of air management and other products for residential and commercial applications, announced on March 21 it had signed a definitive agreement to acquire the HVAC business of Thomas & Betts Corporation (T&B), which is a wholly owned subsidiary of ABBLtd (VTX: ABBN), a global power and automation company. Wells Fargo Securities, LLC served as exclusive financial advisor to Nortek.
Under the terms of the agreement, Nortek will pay approximately $260 million for Thomas & Betts' HVAC business in an all-cash transaction. T&B'sHVAC properties include Reznor Manufacturing Company, LLC (U.S.), AmbiRad Ltd (U.K.), Reznor Europe, N.V. (Belgium), Gaz Industrie S.A.S. (France) and manufacturing operations in Monterrey, Mexico.
T&B HVAC designs, manufactures and sells unit heaters, radiant heaters and rooftop heating, ventilation and cooling products for industrial and commercial applications, primarily in North America and Europe. Principal end-use applications for T&B HVAC products include warehouses, factories, restaurants, retail locations and institutions, and other applications.
Net sales of T&B HVAC were approximately $160 million in 2013. The transaction is expected to close during the second quarter of 2014, subject to customary closing conditions including approval pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
"Acquiring this business will enable us to extend our air management business into attractive adjacent segments of the HVAC market in the United States and Europe," says Nortek President and Chief Executive Officer Michael J. Clarke. "This business will help link three of our five major segments in the air management category, which include our residential ventilation, residential heating and cooling, and custom and engineered solutions segments."
T&B and Reznor products will now join the Nordyne family of residential and commercial HVAC products available in the US, which includes Broan, Nutone, Mammoth (makers of commercial, custom packaged HVAC systems), and Huntair, makers of airflow management products such as air handlers, motors and clean room products). Nortek's Eaton-Williams businesses in Europe will also be enhanced by the acquisition.