100-year old company exploring options for motors & generators business segment
Regal Rexnord Corporation announced that it "intends to explore strategic alternatives for the global motors and generators businesses" that represent a majority of the sales within its Industrial Systems reporting segment, per a November 30 press release from the Beloit, Wisconsin-based manufacturer, adding that "the strategic review may or may not lead to a decision to divest these businesses."
Regal Beloit and Rexnord Corp. of Milwaukee in which Rexnord separated its Process & Motion Control segment via a tax-free spin-off to its shareholders and then immediately combined it with Regal in a Reverse Morris Trust transaction.
Regarding the announcement, CEO Louis Pinkham commented, "I am proud of what our Industrial team has accomplished in the last few years. Through their disciplined deployment of 80/20 and rigorous use of lean tools, adjusted EBITDA margins for the business have improved by roughly 700 basis points. The business is also growing nicely, aided by share gains, which is evident in recent revenue and orders performance. Now, after carefully considering for some time how best to help the Industrial Systems business maximize its potential, we decided to explore whether there might be a better owner of these assets, in particular our global motors and generators businesses. It is in this spirit that we're launching the strategic review announced today. We plan to review our findings in a disciplined and rational manner, and after sharing conclusions with our associates, make them known to other relevant stakeholders."
Regal's motors and generators segment is one of the world's oldest designers and manufacturers of integral (~>5 HP) motors and generators for a diverse range of industrial applications, with a 100+ year legacy of engineering excellence and product innovation.
Guggenheim Securities is serving as financial advisor associated with the strategic review, Wednesday's press release said.