Ingersoll Rand continued on its decade-long expansion track in December, announcing a definitive agreement to acquire Trane, Inc, formerly American Standard Companies, Inc, for approximately $10.1 billion. Trane is a leading company in the climate control sector.
"The combination of Ingersoll Rand and Trane will create a global, diversified industrial company with projected pro forma 2008 revenues of $17 billion,” according to Herbert Henkel, Ingersoll Rand chairman, president, and chief executive officer. “The new Ingersoll Rand portfolio will include an $11 billion climate control business which will offer high value equipment, systems and services necessary for delivering solutions across the temperature spectrum for indoor, stationary, and transport applications worldwide.”
He added that the acquisition represents a major step in Ingersoll Rand's transformation to become a leading global diversified industrial company, with strong market positions across the climate control, industrial, and security markets.
"The acquisition of Trane meets our long-term objectives of significantly increasing consistency of revenue and income streams, adding strong brands and market positions, and further strengthening the organic growth potential of our portfolio,” Henkel said. “Trane's leadership position in the global commercial and residential climate control industry enhances our own highly regarded Hussmann and Thermo King brands.”
Market analysts generally hailed the acquisition. Eli Lustgarten of Ohio-based Longbow Research was quoted in the daily press as saying, “It’s a good strategic long-term acquisition,” adding that a good part of Trane’s growth over the next several years could occur offshore as U.S. housing construction lags.
Trane provides climate control systems and services for residential and commercial structures around the world, including heating, ventilation, and air conditioning systems; dehumidifying and air cleaning products; service and parts support; advanced building controls; and financing solutions.
Trane's 2007 annual revenues are expected to approximate $7.4 billion. Trane has more than 29,000 employees and 29 production facilities worldwide.
Ingersoll Rand's 2007 annual revenues are projected to be approximately $8.7 billion. The company has 35,000 employees and 80 manufacturing facilities worldwide.
The deal is expected to close by or early in the second quarter.
