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By PBN Staff
By PBN Staff
PROVIDENCE – Looking to expand its capabilities and markets, Nortek has agreed to pay about $260 million in cash for the heating, ventilation and air conditioning business of Thomas & Betts Corp., a wholly-owned subsidiary of ABB Ltd., an international power and automation manufacturer.
“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,” said Nortek President and CEO 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.”
The businesses being acquired, which include operating units in the U.S., Belgium, France, Mexico and the United Kingdom, design, manufacture and sell industrial and commercial heating, ventilation and cooling products, used by warehouses, factories, restaurants, retails and institutions. In total, the businesses reported about $160 million in sales in 2013.
Nortek expects to cover the costs of the purchase as well as the retirement of $93 million of existing debt through a roughly $350 million senior secured term loan and cash on hand. Participating institutions for the loan are RBC Capital Markets; Royal Bank of Canada; UBS AG Stamford Branch; UBS Securities LLC; Wells Fargo Bank N.A.; and Wells Fargo Securities LLC.
The transaction is expected to close during the second quarter of 2014, said the company, subject to customary closing conditions, including approval based on antitrust laws.