By acquiring a global leader in the critical power market, and combining it with its subsidiary MGE UPS Systems, Schneider Electric said it will become a major worldwide company in the sector. Growth in the critical power market is being driven by concerns regarding the reliability of the electric power grid and the need for power supply continuity in an increasing number of critical applications.
APC is a leader in small and medium uninterruptible power supply (UPS) systems (representing approximately 74 percent of APC sales). The company also has one of the fastest growth rates in the industry in large UPS systems (more than 30 percent per year). This strong growth in large UPS has required significant investments which have negatively impacted APC's operating margin (9.4 percent in 2005). Due to its experience in this industry through MGE UPS Systems, Schneider Electric said it is confident that it can rapidly improve APC's profitability on a going forward basis.
The transaction is expected to close in the first quarter of 2007.
Publication date: 11/13/2006