Updated, Nov. 30.
Can a merger between a leading supplier of industrial motors and a leading supplier of industrial drives break the historical tendency of U.S. manufacturing end-users to mix-and-match motors and drives from different suppliers?
乔霍恩，首席执行官（首席执行官）ABB Ltd。, thinks that his company’s $4.2 billion acquisition ofBaldor Electric Co.,announced on Nov. 30, has a chance to do just that. “I don’t think there’s ever been two companies coming together that have such expertise and capabilities in motors and drives at one time,” Hogan said during a conference call for analysts, investors and media.
“Remember that we (ABB) have the world’s largest low-voltage drives business, and John (McFarland, Baldor Board chairman and CEO) and his team have the most successful尼玛industrial motors business,” Hogan continued. Such a choice combining two leading brands for motors and drives from a single vendor is “a different opportunity than what’s been presented in the past,” he contended. Hogan noted too, however, that the combined company will “put together anything that makes sense for customers. If they feel that they want to mix and match, we’ll mix and match.”
Hogan confirmed during the conference call that ABB plans to maintain the Baldor brand name. “Baldor has a great brand, and you won’t see us get in the way of the Baldor brand at all,” he said. “We want to make sure that it’s enhanced as much as possible.” ABB also said that it plans to locate its motor and generator business headquarters for North America in Fort Smith, Ark., where Baldor is headquartered.
Cash deal
In a Nov. 30 press release announcing the deal,ABB（www.abb.com.), the Zurich, Switzerland-based power and automation technology supplier said that it has reached an agreement withBaldor (www.baldor.com), a major supplier of industrial motors, by which ABB will acquire Baldor in an all-cash transaction valued at approximately $4.2 billion, including $1.1 billion of net debt.
根据董事会两家公司董事会一致批准的最终协议的条款，ABB将开始为每股63.50美元的现金购买哈尔德尔的优秀股份的投标。该交易于2010年11月29日占Baldor的股票价格的41％溢价。Baldor董事会将推荐哈尔德尔股东在招标报价中投标股票。该交易预计将于2011年第一季度关闭。
ABB noted in its release that the transaction closes a gap in its automation portfolio in North America by adding Baldor’s NEMA motors product line (for National Electrical Manufacturers Association) and positions the company as a market leader for industrial motors, including high-efficiency motors. Baldor also adds a growing and profitable mechanical power transmission business to ABB’s portfolio.
关注能量
The company expects the transaction to substantially improve access to the industrial customer base in North America, opening opportunities for ABB’s wider portfolio, includingenergy-efficientdrives and complementary motors. This move comes at a time when regulatory changes in the United States and other parts of the world will accelerate demand for energy-efficient industrial motion products. ABB further expects the acquisition to strengthen its position as a leading supplier of industrial motion solutions, and will also enable it to tap the potential in North America for rail and wind investments, both of which are expected to grow rapidly in coming years.
“Baldor is a great company with an extremely strong brand in the world’s largest industrial market,” ABB CEO Hogan. “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.”
John McFarland, chairman of the Board and CEO of Baldor, commented: “Our Board of Directors believes this transaction is in the best interest of our shareholders, our employees and our customers. It demonstrates the value our employees have created and the strength of our brand and products in the global motors industry. 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.”
McFarland will stay with the combined business to support a successful integration. And he agrees with Hogan’s comment that the Baldor acquisition by ABB could lead to more frequent selection of single-vendor motor-drive combinations by U.S. manufacturers. Baldor customers today purchase about $500 million worth of drives per year. “I’d say that the drives product line that we currently have is pretty limited compared to what ABB has, and it’s especially limited in the large, expensive drives that we often have an opportunity to quote, but don’t have a product to quote,” McFarland observed during the conference call with editors and analysts. “We sell lots of medium-voltage motors. They’re often used with someone else’s medium-voltage drive (because) we don’t have a product. We’re excited about having a product in the future.”
“ABB在市场上是众所周知的溢价，创新和先进的产品。我们尊敬他们作为市场参与者和复增值供应商多年来，“哈尔德尔现任总裁兼首席运营官（COO）和首席执行官表示。在交易完成后，Tucker将运行Baldor，包括机械电力传输产品商业和ABB的电机和发电机业务。
Baldor business
Baldor employs approximately 7,000 people and reported an operating profit of $184 million on revenue of $1.29 billion in first nine months of 2010. This represents an increase of 30 percent in operating profit and 11 percent in revenue over the comparable period in 2009.
“ABB and Baldor will be able to offer our North American and global customers an unparalleled range of high-efficiency industrial products and services to help them meet their new demands,” said Ulrich Spiesshofer, Executive Committee member responsible for ABB’s Discrete Automation and Motion division, into which Baldor’s business will be integrated alongside the existing Motors and Generators business. “We expect to achieve over $200 million in annual synergies by 2015, consisting of more than $100 million annual cost synergies and at least the same global revenue synergies. We estimate two-thirds of these synergies will be realized by 2013. We intend to build on Baldor’s excellent North American position to sell energy efficient drives, larger motors and generators. Together, we will accelerate the expansion of Baldor’s mechanical power transmission product portfolio into the global process automation market using ABB’s strong channels in this sector.”
在与编辑和分析师的电话会议期间，Hogan重申了北美离散制造市场中普遍渗透的重要性。为此，Baldor的35个代表网络，400个现场销售人员和4,000名经销商预计会增加ABB的电机和驱动器的存在和销售渗透。ABB预计到2015年公司组合的协同效力将达到2亿美元。预计单独的全球采购预计将达到7500万美元，而交叉销售产品预计将增加1.65亿美元的收入协同作用，占总协同作用的约70％。根据Hogan的说法，结合产品线将ABB填充到完整的电机和驱动器产品中。
Under the terms of the merger agreement, the transaction is structured as a cash tender offer to be followed as soon as possible by a merger. The tender offer is expected to commence in December and is subject to customary terms and conditions, including the tender of at least two-thirds of Baldor's shares on a fully diluted basis, and regulatory clearance.
ABB
www.abb.com.
Baldor Electric Co.
www.baldor.com
