Illinois Tool Divests Forkardt - Analyst Blog
10 5월 2013 - 10:20PM
Zacks
Industrial tool maker,
Illinois Tool Works Inc. (ITW) divested its
Forkardt assets to Hardinge Inc. (HDNG) for
approximately $34 million, funded in cash and debt.
Forkardt is a Michigan based
company that was merged with ITW Workholding in 2004. Since then,
the combined entities grew to become one of the leading
manufacturers of high-precision, specialty and customized
workholding devices for machine tools. Forkardt has well-recognized
brands working under its umbrella: viz, Forkardt, NA Woodworth,
Buck Chuck, Sheffler Collet, and Logansport Cylinder.
With the divestment of Forkardt,
Illinois Tool is likely to lose as much as $47 million in revenue,
which the business generated in year 2012 while it earned $34
million in sale proceeds.
Prior to this transaction, Illinois
Tool divested its Decorative Surfaces segment in the fourth quarter
2012 as part of the company’s strategic initiative to grow through
disposition of non-core business. Alongside divestments, meaningful
acquisitions also remain a preferred way for expansion; the company
spent roughly $730 million on acquisitions for annualized acquired
revenue of approximately $500 million in 2012.
Other strategic initiatives of
Illinois Tool aimed at long-term growth include Business
Simplification and Strategic Sourcing. The first strategy is
expected to bring smaller revenue generation units having common
products or line of business under one roof while the second
initiative will enable the company to better manage its raw
materials and other costs.
Illinois Tool Works is one of the
leading manufacturers of industrial products and equipment. The
stock currently has a Zacks Rank #3 (Hold). Other stocks to watch
out for are Tri-Tech Holding, Inc. (TRIT),
Graco Inc. (GGG), and Omnitek Engineering
Corp. (OMTK), each holding a Zacks Rank #1 (Strong
Buy).
GRACO INC (GGG): Free Stock Analysis Report
HARDINGE INC (HDNG): Free Stock Analysis Report
ILL TOOL WORKS (ITW): Free Stock Analysis Report
TRI-TECH HOLDNG (TRIT): Free Stock Analysis Report
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